Saturday, July 08, 2017

Housing Search Continues For 40 Booted, Low-Income Residents After New Landlord's Decision To Refuse Section 8 Subsidized Tenants, Renovate Premises & Boost Rents Displaced Over 100 Households

In Garner, North Carolina, WTVD-TV Channel 11 reports:
  • Forty low-income neighbors at a Garner apartment complex are still struggling to find a place to live after the developer decided to renovate and remove Section 8 vouchers from its tenancy.

    Right now 100 households are receiving help from different agencies, such as property companies and Wake County Commissioners. And this week, a new property management group is coming forward to help.

    But residents and activists say they are disappointed that the Town of Garner, whose municipal offices sit across the street from Forest Hills Apartments, has done little to help residents.
    In a statement, they said the Town is "sympathetic to Forest Hills residents, but absent a housing subsidy program, it is difficult to find a solution that is fair and equitable to all the citizens of Garner."

    Officials told ABC11 in the statement that town officials have worked closely with the appropriate resource agencies to help obtain assistance and housing options for the residents of Forest Hills Apartments. They have also spoken to and met with the complex's property manager to seek more time for residents to find new housing.

    A Garner spokesman also noted that the Town funds a number of local, established nonprofits that provide various forms of assistance to residents in need in the Garner area, and pointed out that "Garner is a diverse community that is known for its affordable and workforce housing supply."

    Wake County leaders report 100 households have found new homes, and they are actively assisting 14.

    Part of that help will include a one-time funding of $25,000 toward emergency assistance specifically for residents still looking.

    Back in March, tenants received eviction notices. The owner of the complex, Eller Capital will be renovating the property and won't accept Section 8 vouchers when it reopens.

    The company gave residents until last week to leave. But Eller Capital, who will only say 'the company is in full compliance with all of its legal obligations under the resident lease agreements', seems to be giving some folks time to linger as they firm up moving plans.
For the story, see 40 displaced Garner residents still search for new home.

For earlier post on this story, see Dozens Of Poor Tenants In Building Financed w/ Federal Affordable Housing Tax Credits Face The Boot From New Owner (Legal Aid Lawyer Argues Recent Foreclosure Doesn't Completely Wipe Out Landlord's Obligation To Provide Apartments For Low-Income Renters).

Another New Landlord With Renovation Plans Buys 112-Unit Affordable Housing Complex, Then Promptly Tells Low Income, Rent-Subsidized Residents To Pack Their Bags & Get Out

In Evansville, Indiana, Tristate Homepage reports:
  • Many residents and community leaders are concerned about the uncertain future for many tenants of an income-based affordable housing complex in Evansville. An out-of-state, private company purchased the mortgage of Lincoln Estates at sheriff's sale last year, according to property records. As a result of the ownership change, many of the 112 tenants are being forced out, including dozens of people on federally-subsidized Section 8 housing, multiple residents said.

    The units at Lincoln Estates serve people who are at or below 80% area media income. As many as 40 of the 112 units at the complex serve those who are on Section 8.

    In late April, resident said they received eviction letters from the property manager, leaving many of the cash-strapped tenants with just weeks to find a new place to live. Thirteen of the tenants were evicted because they were delinquent on their payments, according to the Evansville Housing Authority.

    The city has never had any ownership stake in the company nor is it involved in the complex's operations, city officials said.

    The complex was built as part of a tax credit program where investors would help cover the cost of construction. Among the investors were banks and the Evansville Housing Authority. Last year, once the 15-year compliance period ended, the Evansville Housing Authority offered to buy out the remainder on the mortgage but the bank refused and foreclosed on the property. The complex was later sold to the out-of-state private company at a sheriff's sale. Residents said they were being evicted so the new owners could renovate the property.

    The sale and subsequent evictions have left the financially-challenged residents of the complex even more hard-pressed to find a place to live.

    "It's kind of hard when you don't have [money] and you're forced to move. It causes issues,"
    said Yvette Fellows. "You've got to pay a new deposit, the move-in fee and rent a U-Haul. When you're on a low income, it's not cheap at all."
    Eyewitness News has spoken with several residents of Lincoln Estates, who tell us that they were given very little notice that they would have to move. This has created hardships as many of them are on fixed or low incomes.

    As many as 40 tenants of the total 112 units are on Section 8 housing, which complicates matters even further because of the challenges associated with Section 8 housing.

Housing Authority Gets OK To Unload Aging, Obsolete 244-Unit Rent-Subsidized Apartment Complex, Giving Hundreds Of Poor, Soon-To-Be Uprooted Households 24 Months To Move; Likelihood Of Finding New Landlords Willing To Accept Section 8 Vouchers Unclear

In Everett, Washington, reports:
  • The Everett Housing Authority is preparing to start a two-year process of moving 244 households from Baker Heights, now that federal officials granted permission to sell the public housing complex.

    Baker Heights includes a few dozen one-story buildings in north Everett’s Delta neighborhood. The cost of fixing the World War II-era structures — an estimated $42 million — is prohibitively expensive. Selling the land could net the housing authority millions of dollars to pay for new development.

    “It’s been our biggest property for (more than) 70 years, so it’s a big milestone for the agency,” executive director Ashley Lommers-Johnson said.

    To let tenants know more about the plans, the housing authority has scheduled meetings on Wednesday and Thursday.

    The agency hopes to start helping people move as soon as August. To make that possible, qualifying tenants will get Section 8 vouchers to help cover rent in other public housing complexes or in privately owned buildings. The agency has offered to pay moving expenses.

    The U.S. Department of Housing and Urban Development granted permission to sell the property on June 4.

    Federal officials determined that Baker Heights is obsolete because rehabilitating the property would cost more than 57 percent of the replacement cost. A failing sewage system is among the needed upgrades.

    The sale has been a long time in the making. The housing authority made that decision in 2005.
    The housing authority already has hosted a series of meetings about the planned move, which has been delayed from its original start date in late 2016. People would leave over the course of 24 months, as vouchers become available. Meetings have been translated into Arabic, Russian, Spanish, Vietnamese and Marshallese, the language of the Marshall Islands in the South Pacific Ocean.

    Long-time Baker Heights resident Michael Hill said he’s pleased with the outreach, but worries about what lies ahead.

    “In a lot of ways they’re really being supportive,” Hill said. “The major problem is the uprooting of the community and finding affordable housing within a reasonable distance.”

    It’s unclear whether any landlords in Everett, or anywhere nearby, will accept Section 8 vouchers. Hill said he’s been searching from Pierce County to Skagit County, without luck. He’d like to stay involved with his local church and community. Other families may have to put children in different schools.

Landlord Announces Plans To Terminate Section 8 Contract, Demolish 171-Unit Complex, & Rebuild, Leaving Over 100 Mostly Low Income Immigrant, Senior Citizen & Disabled Households Facing The Boot

In Milpitas, California, The Mercury News reports:
  • Told they have to leave by March, tenants of the Sunnyhills Apartment complex are worried they won’t be able to find comparable low-rent housing elsewhere and many even fear they could end up homeless.

    In interviews with the Milpitas Post over the last three weeks, residents like Vinh Nguyen said they have lived in the complex at 1724 Sunnyhills Drive for many years and built their lives there. Nguyen, a 20-year tenant at the complex, said most residents are either low-income immigrants who speak limited English, senior citizens or disabled.

    “We need time to get voucher and apply for other places to live. If apartment closes we don’t know where to go,” Nguyen said.

    Santa Clara based-JMK Investments, which owns the 171-unit property, informed residents of its plan to not renew a contract with the Department of Housing and Urban Development, which subsidizes two-thirds of the units either directly or through Section 8 vouchers, which cover the difference between actual rents and what tenants can afford.

    JMK wants to tear down the complex and build 164 three-story and 57 two-story market-rate townhouses in its place.
    Antoinette Doyle, a 22-year Sunnyhills resident, said she’s started to give away some of the items collected over the years in case she is forced out. “I’ve called 50 to 60 places that are low-income, but most of them have a three- to five-year waiting list,” she said.

    Terry Perez, a single mother who has lived in the complex 17 years, said she finds the situation “heartbreaking and scary. I have my family but I am not guaranteed I am going to have a place to live. How scary is that? We have had people who have lived here for years, and for me and my daughter, she is going to Milpitas High School, she is going to graduate. If this happens and we get evicted, what’s going to happen, where we end up? Will we have good neighbors or access to good schools?”

    Perez said she’s called other affordable housing operators and been told there are years-long waiting lists. Some apartment complexes refuse to take Section 8 vouchers, she said, and others only accept them during certain times of the day, making it difficult for people with jobs to bring them in.

    Ken Wong said his mother-in-law Mei Qing Zhan, a resident of the complex, is almost 90, has a congenital heart disorder and is in a wheelchair, so some multi-level buildings that don’t meet Americans with Disabilities Act requirements aren’t viable. And finding ones that are has been “impossible” since February.

    Sue Lawrence, a six-year Sunnyhills resident, said finding a place to relocate to and then getting the necessary help to move in will be a hardship.

    I am 78 years old and I am no spring chicken,” Lawrence said. “The last few years my son always helped me. He would help me, but he was murdered a couple of years ago and I have no one to help me. … It is a big expense for an old woman. I feel very insecure. … I’m really depressed, upset, scared, I don’t know what to do and which way to turn.”

    Patricia Lopez-Ruiz, who has lived in the complex for 22 years and whose two sons went through the Milpitas Unified School District, said there are many elderly tenants who want to live independently and wouldn’t be able to do so if they are kicked out. She said a lot of residents, including herself, “don’t have the money to move out. We live paycheck to paycheck.”

    Other residents mentioned feeling “sickened,” “not being able to eat or sleep,” and “anxious” about what will happen come March.

Boot May Be Near For Hundreds Of Low Income Residents In 237-Unit Complex As New Landlord Announces Plans To Stop Accepting Section 8 Vouchers, Renovate Apartments, & Boost Rents

In Des Moines, Iowa, The Des Moines Register reports:
  • An East Village apartment complex that is home to hundreds of low-income residents, including immigrant and refugee families, is poised to change owners — a move that could eliminate its subsidized housing to capitalize on Des Moines' downtown boom.

    Housing advocates fear the impending sale of River Hills Apartments 1, a 237-unit complex that straddles East Fifth Street just south of Interstate 235, will put more pressure on a rental market that already has a severe shortage of low-income housing.

    More than 100 households at the apartment complex use federal housing subsidies, commonly known as Section 8 vouchers, to pay their rent.

    River Hills' tenants include a diverse mix of families from Southeast Asia, Africa and other regions, as well as native Iowans looking for an affordable place to live, advocates say.

    "There simply is not enough affordable housing for lower-income families in Des Moines,” said Carly Ross, director of U.S. Committee for Refugees and Immigrants in Des Moines.

    Des Moines-based BH Equities, one of the largest apartment owners nationwide, plans to buy River Hills from Darwin T. Lynner Co., another local apartment firm. Officials from BH Equities said the plan to close the deal in August but declined to disclose a purchase price.

    Ben Roby, an acquisition manager for BH Equities, said the company is still assessing its options but intends to eventually charge market-based rental rates and stop accepting vouchers.

    He said the transition will take two to three years and BH Equities does not plan to kick out renters and wants to work with tenants to find new housing if needed.

    But refugee and affordable housing advocates say the move could force out hundreds of low-income renters.

    “It’s very disappointing,” Ross said. “Des Moines is already facing a shortage of a housing that is accessible to refugees and immigrants and this is a very big loss for families who are trying to find safe and affordable housing in our community.”

    Residents of River Hills who use vouchers will be able to stay until at least 2018, when their subsidized leases expire, according to Des Moines housing services Director Jackie Lloyd.

    But at that point, the new owner could refuse vouchers and raise the rent.

    And advocates say finding new rentals won't be easy.
    BH Equities plans to make some exterior improvements and renovate apartment units one-by-one as they become vacant but does plan a large overhaul of the property.

Friday, July 07, 2017

Queens DA: Paralegal Used Employer's Law Firm To Develop Side Business Peddling Loan Modification Services To Unwitting Attorney's Clients; Leads To Alleged Ripoff Of $80K In Two Separate Cases, Failing In Attempt To Pilfer An Add'l $44K

From the Office of the Queens County, New York District Attorney:
  • Queens District Attorney Richard A. Brown, joined by New York State Department of Financial Services (DFS) Superintendent Maria T. Vullo, today [June 21] announced that a 40-year old paralegal formerly employed at a Jackson Heights law firm has been charged with stealing $80,000, and attempting to steal an additional $44,000, by claiming that he could help one of the firm’s clients and another homeowner in distress and in danger of foreclosure with loan modifications on their mortgages.

    District Attorney Brown said, “Unbeknownst to his employer, the defendant allegedly developed a side business in which he told clients of the law firm that he could help them with modifying mortgage loans on properties that they owned and oftentimes met with them at the law firm. Instead of helping people with their mortgage problems, the defendant is accused of helping himself to their money, stealing tens of thousands of dollars. Even after he was fired from the law firm, he allegedly continued his scheme by meeting with a distressed homeowner at various fast food locations around Queens County.”
    The District Attorney identified the defendant as Hyun Do Kim, also known as Billy Kim, 40, of Whitestone, Queens.
    District Attorney Brown said that, according to the criminal charges, Kim was employed as a paralegal at a Jackson Heights law firm between September 2009 and April 2012, and that during this time he told clients of the law firm that he could help them with loan modifications – which was not within the scope of his employment at the law firm.

    In one instance, it is alleged that a client met with Kim for a loan modification on his Flushing property and was told that he should pay Kim with cash on a monthly basis – instead of paying his mortgage – and that Kim would forward the money to the mortgage company as part of the loan modification process.

    In furtherance of his alleged scheme, Kim provided the client with copies of the purported checks he sent to the mortgage company as receipts, as well as a receipt written on the law firm’s stationery and signed by Kim and stamped in the name of the firm’s lawyer. However, a review of those checks allegedly revealed that they were never mailed to the client’s mortgage company and that the account from which they had been written was closed in 2009.

    Additionally, the firm’s attorney stated that Kim did not have permission or authority to issue a receipt to the client on the firm’s stationery as the firm was not involved in any loan modifications made on behalf of the client and his property. Further investigation allegedly revealed that Kim did not initiate or engage in a loan modification for the client despite having been paid more than $70,000 by the client between March 2010 and July 2012.

    Additionally, it is charged that in September 2015, a 69-year-old homeowner in danger of foreclosure contacted Kim about a loan modification for a propertythat he owned with his 73-year-old aunt in Bayside, Queens. It is alleged that Kim told the two property owners to make payments to his company, JC Financial of NY, instead of sending payments to their mortgage company and that he would send the monies to the bank as part of the loan modification process. The two property owners allegedly paid Kim more than $10,000 between September and October 2015 for the loan modification which he never completed for them. It is further alleged that the Bayside house was foreclosed upon during the time the property owners were paying Kim and that the house was sold at auction.

    Finally, according to the criminal charges, while the loan modification was purportedly pending on the Bayside property, Kim offered the 69-year-old client assistance with a second Queens house that he owned. It is alleged that Kim provided the client with a fax cover sheet that was purportedly from a Westbury, Long Island, law firm, which acted as a debt collector, and which directed the client to make an initial payment of $44,000 via certified check to begin the modification process and avoid foreclosure.

    Suspicious of the fax, the client visited the Westbury law firm and discovered that the document was forged, the name of the law firm was incorrect on the fax sheet, and that the law firm had no dealings with Kim on behalf of the client.
Source: Moonlighting Queens Paralegal Charged With Stealing $80,000 From Clients Of Jackson Heights Law Firm That Employed Him (Defendant Allegedly Told Victims He Could Help With Mortgage Loan Modifications).

Maryland Feds Score Guilty Pleas From Pair, Jury Conviction Against Another For Roles In Peddling "Principal Reduction" Foreclosure Rescue Racket That Duped Financially Strapped Homeowners Out Of Upfront Fees, Monthly Payments In Exchange For False Promises To Negotiate Reduced Loan Payoffs With Their Home Lenders

From the Office of the U.,S. Attorney (Greenbelt, Maryland):
  • A federal jury convicted Ana Maritza Gomez, age 44, of Hyattsville, Maryland, today [June 23] on one count of conspiracy to commit mail and wire fraud and five counts of mail fraud arising from a scheme to defraud victims through a foreclosure rescue fraud scam.

    Two co-defendants, Rene De Jesus De Leon, age 48, and Pedrina Rodriguez Bonilla, age 38, both of Silver Spring, Maryland, have also pleaded guilty to conspiracy to commit mail and wire fraud for their involvement in the same scheme.
    According to evidence presented at the six-day trial, from at least late 2011 to August 2015, Gomez and her co-conspirators claimed that they could help homeowners who wanted to modify their mortgage loans and prevent foreclosure of their homes. The conspirators sold the victims on a “principal reduction” program that included an upfront fee, typically between $3,000 and monthly payments for 10 to 15 years. Gomez and her co-conspirators told the victims to make monthly payments to the conspirators and to companies they controlled, in lieu of to the homeowners’ lenders, as part of the conspirators program. The companies controlled by Gomez’s co-conspirators were named Marketing Multiservices LLC and Innovative Solutions Services LLC.

    According to the indictment and court documents, the conspirators mailed monthly invoices to the homeowner victims that falsely indicated that the “principal balance” was being paid down. Some of the victims paid Gomez in person each month at her residence; or some of the victims deposited their payments directly into bank accounts controlled by Gomez’s co-conspirators. The conspirators told the victims not to open any mail from their lenders and instead provide it to the conspirators. The conspirators did not, however, negotiate with lenders of behalf of the homeowners. Many of the victims lost their homes.
Source: Hyattsville, Maryland Woman Convicted of Mail and Wire Fraud (Fraudulently Claimed She Could Save Victims’ Homes from Foreclosure).

Thursday, July 06, 2017

Son Faces Charges For Allegedly Abusing POA To Fleece Dementia-Stricken Father Out Of Over $170K; Loot Included $146K Sale Proceeds Of Victim's Vacated Home; Police Probe Triggered When Defendant Stiffed Assisted Living Facility Out Of Payments For Ailing Dad's Care

In South Strabane, Pennsylvania, the Observer-Reporter reports:
  • A Florida man was arraigned Thursday [June 29] on theft-related charges for allegedly stealing more than $170,000 that was to be used to care for his elderly father.

    Richard J. Nixon, 48, of Wildwood, was arraigned before District Judge Jay Weller on charges of theft, theft by failure to make required disposition of funds, having knowledge that the property was the proceeds of an illegal act and bad checks filed by South Strabane Township police.

    Detective Michael Schidlmeier said police were notified in February by an administrator with Hawthorne Woods [assisted living facility] the finances of the elderly man had been liquidated and payments for care were delinquent. Nixon had been given power of attorney in June 2014, for his father, who has dementia.

    Nixon’s father had been admitted to Hawthorne Woods in January 2016. The account manager verified the father’s monthly income from Social Security and his pension. The elderly man also had money in a bank account and in a certificate of deposit and a home in Chartiers Township Schidlmeier learned had been sold in March 2016 for $146,000. The money from the sale had been deposited in a joint account held by Nixon and his father. Nixon opened a personal account and reportedly transferred the money to that account.

    The account manager told Schidlmeier Nixon stopped making payments for his father in September. In an emailed response, Nixon reportedly told the account manager he “messed up. Dad’s money is gone. I made a bad investment in the market and lost it all.” Nixon also reportedly sent a personal check to Hawthorne Woods in December for $12,600, but it was returned for insufficient funds.

    Bank records obtained by police show Nixon’s account had no other income other than deposits and transfers from the joint account. The bank statement indicates Nixon was using his father’s money for day-to-day expenses, mortgage payments for a house in Florida and vacations. Schidlmeier is asking the court for $172,814 in restitution.

    Nixon remains free on unsecured $25,000 bond pending his preliminary hearing at 11:30 a.m. Aug. 14.

Queens DA: Scam Artist Abused POA To Fleece Ailing. 83-Year Old Friend Out Of Over $100K In Real Estate Sale Proceeds

From the Office of the Queens County, New York District Attorney:
  • Queens District Attorney Richard A. Brown today [May 24] announced that a 68-year-old Queens man has been charged with stealing more than $100,000 from an 83-year-old female friend who gave him power of attorney to act in her stead as her health was deteriorating and she was losing her eyesight.

    District Attorney Brown said, “This case is a clear example of why people have to be very careful as to whom they give power of attorney over their financial affairs. In this case, the defendant is accused of betraying the trust of a friend to unscrupulously steal more than $100,000 from her and with attempting to steal additional monies by liquidating an investment account she maintained to open a guaranteed lifetime annuity account, listing himself on the application as the sole beneficiary and the purported spouse of the victim.”

    The District Attorney identified the defendant as Herman Smith, 68, of Jamaica, Queens. Smith was arraigned [...] on a criminal complaint charging him with one count each of second-degree larceny, second-degree attempted larceny, first-degree scheme to defraud and endangering the welfare of an incompetent person.
    District Attorney Brown said that, according to the charges, the 83-year-old victim executed a Power of Attorney on September 17, 2014, authorizing Smith to act as her agent due to her failing health and eyesight. The Power of Attorney did not grant Smith permission or authority to transfer and/or withdraw monies for any purpose other than to assist her with her financial responsibilities.

    According to the charges, said District Attorney Brown, Smith paid bills on behalf of the victim and represented her at a real estate closing for a property she owned on North Columbus Avenue in Freeport, Long Island. In September 2015, the victim moved to North Carolina and, upon her leaving the state, she authorized Smith to represent her at the sale of a second property she owned on Parsons Avenue in Freeport, Long Island.

    A review of two Chase Bank accounts belonging to the victim allegedly revealed that, prior to July 10, 2015, the address of record on her Chase accounts was listed as the victim’s Parsons Avenue residence and that monthly statements were sent to that location. On August 31, 2015, it is alleged that a real estate closing check payable to the victim in the amount of $114,036 and endorsed by the victim and Smith was deposited into one of the victim’s accounts at a Chase Bank branch located near Smith’s Queens residence.

    It is alleged that between September 2, 2016, and September 10, 2016, Smith unlawfully transferred a total of $65,000 from the victim’s account to another Chase account belonging to him, and that he unlawfully made three separate cash withdrawals totaling $33,475.08 from the victim’s account. Further, it is alleged that two checks payable to the victim and totaling $3,343 were also unlawfully deposited into Smith’s Chase account. A further review of Chase records allegedly revealed that Smith’s account listed a second account holder – Yvette Kelly, a 64-year-old female individual who also had added Smith to her bank account via a Power of Attorney agreement. When Ms. Kelly died on June 10, 2014, it is alleged that Smith kept her account open.

    It is additionally alleged that a review of Smith’s account revealed that between February 18, 2014, and June 1, 2015, Smith transferred more than $80,000 from his Chase account to the Chase account belonging to Ms. Kellyand that $76,287 was removed from Ms. Kelly’s account between February 18, 2014, and March 25, 2015, by means of 92 ATM withdrawals done in Atlantic City via Smith’s Chase debit card.

Couple Faces Criminal Charges For Allegedly Duping 87-Year Old Man Out Of Over $100K By Talking Him Into Selling His Home, Then Leaving Him Off Title Ownership When They Used Sale Proceeds To Buy Another House

In Las Vegas, Nevada, the Las Vegas Review-Journal reports:
  • A woman who coordinates senior services for the Southern Nevada Regional Housing Authority was indicted Wednesday [June 26] on charges that she and her husband swindled more than $100,000 out of an elderly man they befriended at a karaoke bar.

    A Clark County grand jury returned the indictment charging Yvette Mendes-Hayes and Lawrence Paul Hayes with exploitation of an elderly person and theft. The charges follow an investigation into allegations of exploitation of Peter Antonucci, who was 87 when he met the married couple while out doing karaoke in 2015.

    Mendes-Hayes earned a taxpayer-funded salary of $55,000 last year in her role providing housing services to senior citizens. In that same year, she is accused of defrauding an aging but lucid man of the wealth he had left by, among other things, persuading him to sell his home.

    According to the arrest warrant filed in the case, Antonucci developed a friendship with the couple after meeting them. Antonucci told authorities that Hayes told him to sell his townhouse, so “they could buy a bigger house and he and Yvette would take care of Peter.”

    Antonucci obliged and sold his Summerlin townhouse for $150,000, with the help of a real estate agent who is a friend of the Hayes couple. The arrest warrant said that Hayes and Mendes-Hayes used the proceeds of the townhouse to purchase a North Las Vegas home but that Antonucci’s name was not listed in any title documents for the new house. The three of them moved into the house in the summer of 2015.

    “Peter said that he was told to stay in his room and had to ask for permission to leave the house,” the arrest warrant said. “He now believes that he was defrauded by the Hayes and they had planned to exploit him.”

    Antonucci told authorities that Hayes told him he could not be on the deed because his only income is Social Security benefits. He also told police that Hayes took the $2,200 in monthly Social Security payments and transferred it into his own account to use the money for mortgage payment, living expenses, and house furnishings.

    Hayes collects disability benefits and is not employed. He has a criminal record that include fraud offenses in Michigan.

    Filings in the case accuse the couple of belittling Antonucci, who told police “he would stay in his bedroom most of the time because every time he came out he was ordered away or criticized by Paul (Hayes).”

    Court filings indicate that Antonucci left the house in May 2016, taking only his clothes, guitars and two handguns. He left furniture and other belongings with the Hayes, who authorities say changed all the locks after Antonucci left.

Wednesday, July 05, 2017

Lawsuit: Scammers Hack Into Non-Secure Email, Then Use Spoof Account To Hijack $272K In Real Estate Closing Funds, Leaving Victimized Homeowner-Couple Without Their Home & Their Money

In Denver, Colorado, KMGH-TV Channel 7 reports:
  • A Colorado couple, who lost their life savings while trying to buy their dream retirement home, has filed suit against Wells Fargo Bank, Land Title Guarantee Co., Envoy Mortgage Ltd., Kentwood Real Estate Services LLC and realtor Karen Porras, alleging that none of them did enough to protect sensitive financial information.

    James and Candace Butcher sold their house in Longmont and were using the proceeds -- more than $272,000 -- as a down payment on a new home, at 41467 Sunny Farm Circle in Parker.

    They said they wanted a place closer to their son and one big enough for grandchildren.

    “We were truly excited, when through negotiations, we won the bid,” Candace Butcher said. “Through the entire process, I kept saying, ‘I can’t believe this is going to be our house.’”

    Within 24 hours of closing, not only was it not their house, but they lost all their money.

    Butcher told Denver7 that she got a phone call from Wells Fargo the following day alluding to problems.

    “They never said up front that it was fraud,” Mrs. Butcher said. “They said, ‘we’re trying to check into it.’”

    “I was sick,” she added. “That was our life savings, the equity that we had built up in our home.”


    The complaint filed in Denver District Court outlines the couple’s allegations.

    They say that during the negotiation, inspection and closing process, the defendants routinely sent sensitive financial information through non-secure email, violating their own and industry guidelines.

    On March 30, Ms. Porras emailed the Butchers and notified them that they would be receiving wiring instructions from Shannon at Land Title prior to closing, which was then scheduled for April 5, 2017.

    On April 3, the couple received an email at 7:49 a.m. and 8:37 a.m. from someone identified as Shannon Ryon at Land Title, requesting that they wire $272,535.96 cash to close, and requested that they reply to the email to confirm receipt.

    The email did not identify the domain name of the receiver.

    At 9:04 a.m., Ashley Johnson of Envoy emailed the Butchers a “final” closing disclosure, which stated that the couple would need to wire funds in the amount of $272,535.96 to close on the property.

    The dollar amount had never been discussed, nor disclosed until the Butchers received emails, with identical numbers, from a Shannon Ryon and from Ashley Johnson.

    The couple’s attorney, Ian Hicks, says it appears that someone hacked into one of the companies’ servers and retrieved financial information and then sent a bogus email to the homebuyers.
    The Butchers told Denver7 that they went to the Wells Fargo Smoky Hill branch and spoke with a personal banker, who then contacted the fraud department. The personal banker apparently informed the couple that she was unable to get any status on the wire transfer, or any investigation by Wells Fargo, even though that it was Kelly Vance at Wells Fargo who allegedly first contacted the Butchers, to inform them the wire transfer was fraudulent.

    Hicks said the Butchers asked to speak to the branch manager, Lyndsey Dehate, and said she opened a case and provided the Butchers with a reference number, and further indicated that an investigator, as well as the legal and wire fraud groups at Wells Fargo, were involved.

    After spending hours at the branch, the couple went home.

    On April 5, the Butchers called the branch and asked Ms. Dehate if she had contacted the FBI.

    The complaint quotes Dehate as saying “Wells Fargo has a policy of not contacting the FBI in situations like this.”

    Hicks told Denver7 that neither Dehate, nor anyone at Wells Fargo, ever informed the Butchers that the FBI can initiate what is known as a “Financial Fraud Kill Chain,” where the FBI can stop a wire transfer and return the funds to a U.S. victim’s bank account within 72 hours.

    James Butcher called the FBI and then, with an agent on the line, contacted Wells Fargo.

    “They were shuttled from one department to another,” Hicks said. “Wells Fargo couldn’t provide basic information… and repeatedly contradicted itself.”

    “They said there was an investigation and then they said there was not,” he said. “They said they had a number assigned to the case and then said they couldn’t see it. It’s unbelievable.”

    Risks known for years

    Hicks said the defendants are all aware that scammers have been stealing money via wire fraud.
    Bank offers money

    Hicks said Wells Fargo offered to return some of the couple’s money, if they relieved them of liability.

    “I rejected that offer,” Hicks said.

    James Butcher said, “It concerns me that they couldn’t come forward and share with us exactly how much. It could very well be a large sum of money, and I don’t know, or it could very well be a small amount of money. I can’t afford that.”

    Future up in the air

    On April 7, an Envoy representative called the Butchers and asked if they still planned to close on the property. The couple informed her that it was unlikely.

    According to the complaint, that Envoy representative informed the Butchers that a similar scam had just been attempted but prevented because Envoy was no longer dealing with wire transfers, only cashier’s checks.

    That’s bittersweet news to the Butchers, who are now living in their son’s basement.

    “We don’t even have a down payment to go buy another home,” Candace said, “so what do we do from here? Are we going to move back into an apartment?”


Another Aging Attorney Gets The Pinch On Seven Embezzlement Counts, Suffers Law License Yank For Allegedly Glomming At Least $42K In Closing Funds Held In Escrow On Behalf Of 3rd Party In Real Estate Transaction

In Hopkinton, Massachusetts, the The Metrowest Daily News reports:
  • The state agency that oversees lawyers has disbarred a Hopkinton attorney for misusing a client’s money.

    As of May 22, Douglas W. Resnick has been disbarred, according to the Board of Bar Overseers.

    According to the board, Resnick has been an attorney since 1977, and during that time, he used money that was in escrow improperly.

    “Over a period of time, the respondent intentionally misused at least $42,000 in escrow funds that were to have been held by the respondent for the benefit of a third-party in a real estate transaction, with deprivation,” the board wrote.

    Resnick never paid the money back, the board said.(1)

    Resnick acknowledged that the board and the Supreme Judicial Court could conclude he violated the rules of law and sent an affidavit to the board seeking to resign as an attorney. The board accepted the resignation, disbarring him.
Source: Hopkinton lawyer disbarred.

For a story update, see MetroWest residents indicted by grand jury:
  • [T]he grand jury charged Douglas Resnick, 64, of Hopkinton, with seven counts of embezzlement by a fiduciary. The state Board of Bar Overseers recently disbarred Resnick, an attorney, due to allegations that he misused at least $42,000 from an escrow account meant to be held for a third party for real estate transactions. The board said Resnick never paid the money back.

    At Resnick’s May 24 superior court arraignment, Sullivan released him without bail, ordering Resnick to have no contact with witnesses. Resnick is due back in court on July 14 for a pretrial conference.  ripoff reimbursement
(1) For links to "attorney ripoff reimbursement funds" that will sometimes reimburse clients victimized by losses caused by the dishonest conduct of their lawyers, see:
Maps available courtesy of The National Client Protection Organization, Inc. ripoff reimbursement

Tuesday, July 04, 2017

Governor's Recent Action Leaves Unit Owners In Older, High-Rise Florida Condominiums Facing Expensive, Fire-Safety Retrofits; Potentially Unaffordable Special Assessments For Retirees Living On Fixed Incomes May Force Them Out Of Their Long-Time Homes

In Fort Lauderdale, Florida, the South Florida Sun-Sentinel reports:
  • Tens of thousands of condominium owners in South Florida and across the state are facing financial pressure to install fire-safety devices in older buildings following Gov. Rick Scott’s veto of a bill that would have allowed them to avoid the work altogether.

    Many unit owners could face thousands of dollars in costs to install fire sprinklers where there are none, while associations face the possibility of levying special assessments to fund upgrades in common areas.

    At least 5,600 condo projects statewide could be affected, although buildings standing less than 75 feet tall would be exempt. Owners in taller structures built after 1994 need not worry as sprinklers for newly constructed projects were mandated that year.

    Association leaders, condo lawyers and residents called the veto a bad deal, while those in enforcement noted that owners have had more than enough chances to install upgrades mandated nearly two decades ago.

    Pio Ieraci, president of the 16,000-resident Galt Mile Community Association in Fort Lauderdale, said the veto will force buildings to spend millions of dollars on sprinklers and other equipment, leading to expensive special assessments — $15,000 to $25,000 per owner, in some cases.

    He said many residents in older buildings are on fixed incomes and could lose their homes in foreclosure if they can’t come up with the money. And he said the assessments could jeopardize the financial stability of condo associations, reduce property values and make it harder for owners to sell individual units.

    “It’s unconscionable and unbelievable,” Ieraci said. “The impact is huge.”

    Under state law, condos taller than 75 feet and built before 1994 must be retrofitted with sprinklers or “engineered life safety systems” by the end of 2019.

    House Bill 653 — sponsored in the House by Rep. George Moraitis, R-Fort Lauderdale, and in the Senate by Kathleen Passidomo, R-Naples — would have extended that deadline until 2022 and allowed condo residents, with a two-thirds vote, to opt out of the retrofits.

    In a 2009 report, the state Department of Business and Professional Regulation, which oversees condos, estimated that 5,600 projects in Florida needed retrofits, though the agency says it doesn’t have a more recent figure.

    In South Florida, the number could top 200 projects, said Donna DiMaggio Berger, a Fort Lauderdale attorney and shareholder with the Becker & Poliakoff law firm representing condo associations statewide.

    The thousands of condos built in South Florida over the past 17 years are not affected. The requirements don’t apply to condo buildings shorter than 75 feet or those built after 1994, when a state law mandated that new buildings have fire sprinklers.

    In a letter to Scott urging him to veto the bill, Julius Halas, director of the Division of State Fire Marshal, said most of the equipment used by firefighters can’t reach a height of more than 75 feet.

    “It has been proven that fire sprinklers are the best means of life safety and property protection available,” he wrote.
    You’ve got a lot of frail residents who can’t move,” said Berger, the attorney. “They are literally shut-ins. They don’t let the pest-control person in, let alone someone to retrofit their unit.”
    Fred Nesbitt, 73, owner of a two-bedroom condo at Galt’s Playa Del Mar and president of its association, said he and other residents already feel safe. Their 347-unit building has smoke detectors and fire alarms throughout.

    In 2015, the building completed $4.5 million in structural repairs, and many of the residents can’t afford another assessment, Nesbitt said. “Coming on top of that, it would be devastating,” he said.

    Eric Berkowitz, 67, who lives in a three-bedroom Galt condo, said he and many of his neighbors live on modest means and wonder whether assessments will force them to leave.

    We’re frightened, is basically what it comes down to,” he said. “I live on a pension and Social Security. Most of the people here are not masters of the universe. We can’t afford something capricious like this.”

Hungry Real Estate Investors Targeting Neighborhoods That Have Historically Been Home For Minorities, Immigrants, & The Poor Create Concern For Gentrification-Fearing, Low-Income Charlotte Residents Dreading Displacement

In Charlotte, North Carolina, The Charlotte Observer reports:
  • The sign posted in Martha McAfee’s yard sends a message to real-estate investors who comb the Enderly Park neighborhood looking for houses:

    “We can’t be bought.”

    But resistance from McAfee and some other residents is unlikely to stop the changes that are remaking one neighborhood after another in Charlotte. As new development spreads from uptown, luxury homes and trendy restaurants are edging closer to Enderly Park, a predominantly African-American neighborhood west of Bank of America Stadium.

    Like homeowners in other historically black areas across west Charlotte, McAfee and some residents now face a difficult choice: Take an immediate lucrative payoff from a real-estate investor or forego the money to help keep the neighborhood affordable for future generations.
    McAfee, 86, said she has seen the mailings and fliers offering cash for homes, but already has her mind made up. She lives in a three-bedroom, one-story house that once sold for $30,000, according to tax records. The house would now sell for about $101,000, roughly $3,700 increase in the last 30 days, says Zillow, a real-estate website.

    A former cook at multiple local hospitals before retiring a few years ago, she said she understands her neighborhood is changing and that some people need the money they could get for their homes. But she wants to leave the house as an inheritance to her children.

    “Why would I would I want to (sell)?” McAfee asked, saying she built roots in Enderly Park, where she is well known by neighborhood children. “When I die, my kids can do with it what they want to.”

    As the neighborhoods surrounding uptown Charlotte have become a preferred choice for well-off homebuyers and millenials, real-estate speculators and developers have increasingly targeted neighborhoods that for decades have been home to African-Americans, immigrants and the poor.

    The trend has spread fear that new investment will bring higher rents and taxes and eliminate some of the last remaining areas for inexpensive housing close to uptown.

    “We have been telling people ‘Don’t sell your homes’” to real-estate investors, said Frank Byers, 61, who has lived in Enderly Park for 17 years and is president of the West Side Community Land Trust.

    “I watched how Wilmore changed. I saw what happened in NoDa, ” Byers said, ticking off neighborhoods where gentrification brought higher home prices and altered the demographics of neighorhoods that were once populated by minorities, who mostly had lower incomes than the newcomers.
    The pros and cons of gentrification — the process that displaces the poor to make room for new, more wealthy residents — have long been debated. It is changing the demographics in parts of west Charlotte. Defunct warehouses and vacant lots adjacent to uptown are making way for trendy restaurants and pricey homes that rent for as much as $2,600 a month.

    But rough edges remain in Enderly Park, where the average household income is about $24,000 a year, less than half the the Mecklenburg County average. On a recent day, a yard sign near the neighborhood’s main thoroughfare advertised a one bedroom apartment for $595 a month.

    More than one in three residents lack a high school diploma and the violent crime rate is nearly five times the county average.

    Still, residents say their mailboxes are filled with advertisements offering cash for homes.


Residents Of Deteriorating Senior Retirement Home Facing Foreclosure Finally Get The Word: You Have A Month To Pack Your Bags

In Topeka, Kansas, KSNT-TV Channel 27 reports:
  • Documents reveal the owners of Valley Springs Senior Retirement Home did not make their mortgage payments. Now, elderly tenants of the home will have to find a new place to live.

    Residents found out about their eviction on Monday [June 26]. They were told they have until the end of July to find a new home and move out.

    Donna Silsby moved into the retirement home about five months ago.

    She said, “I have family here, it’s why I moved here to begin with. So I really have no idea where I will go.”

    The grounds of the Valley Springs Retirement Home are overgrown and appear not to have been maintained for some time.

    “It’s dark out here at night. We’ve got elderly people out here,” said Valley Springs Resident James Underbird. “We’ve got one that’s 96 years old, losing her eye sight and basically she’s afraid.”

    There are 24 apartments at the complex. Residents tell KSNT News that half of them are occupied, but not for long.

    “I would not bring my parents to live in a place like this the Way it looks now,” said Underbird.

    The property is being foreclosed upon by Sunflower Bank, out of Salina. Residents have been told to pay any monies owed to Sunflower bank.

    They will get $1,500 to help with moving expenses. $750 when they sign the move-out agreement and another $750 after they move out.

Monday, July 03, 2017

Retirement Home Peddler Accused Of Using 'Complex, Draconian' Contracts, 'Rapacious' Exit Fees To Screw & Squeeze Elderly Homebuyers If They Try To Unload Their Homes In The Future; Terms Incentivize Operator To Churn Residents After They Buy To Beef Up Profits; Consumer Advocate: "It's A Bit Like A Financial Prison..."

In Sydney, Australia, ABC Online reports:
  • Residents of the multi-billion-dollar retirement village industry have described buying into a retirement village as a "financial sinkhole".

    A joint investigation by the ABC's Four Corners and Fairfax Media into retirement village company Aveo has uncovered exorbitant fees and complex contracts.

    One former resident describes Aveo's business practices as "totally rapacious, I don't know how they get away with it".

    Fairfax Media and Four Corners spoke to current and former residents, their children, lawyers, former Aveo staff and lobby groups and found several alarming business practices at Aveo — including safety issues, misleading marketing and advertising and property sales.

    The joint investigation obtained numerous Aveo contracts, which included clauses some lawyers described as complex and draconian.

    Chief executive of the Consumer Action Law Centre Gerard Brody described some of Aveo's contracts as among the worst he had seen. "Not only are they over 120 pages in length, they're dense, they're hard to understand, they're legalistic," Mr Brody said.

    Current and former residents also described the company's model — which takes an exit fee as high as 40 per cent of the original purchase price, leaving outgoing residents often forking out in excess of $100,000 — as "financial abuse of the elderly".

    Aveo has 13,000 residents across Australia and is expanding at a rapid rate. It expects to increase its resident numbers to 20,000 in coming years. Those residents live in just over 11,000 units in 89 villages.

    The company is rolling out two new contracts, the Aveo Way — which has exit fees of 35 per cent after three years — and Freedom Aged Care — which charge exit fees of 40 per cent after two years.

    An exit fee is unique to the retirement industry. It is calculated as a percentage of the purchase price charged by retirement village operators when a resident sells the property.
    Aveo is a financial juggernaut with a market capitalisation of about $1.8 billion.

    In 2016, it doubled its profit to $116 million. The majority of its profits come from exit fees extracted from residents on their departure.
    Mr Brody said some residents may want to exit, but find the cost of doing so prohibitive.

    "When it comes time to exit, some people can feel trapped," he said.

    "It's a bit like a financial prison. These fees are too high to enable them to exit, move into aged care, or back close to relatives and family."
For the story, see Aveo: Exploitation of the elderly rife in retirement villages.

See also, The price of Freedom (Its slick marketing promises a safe and sound place to live yet retirement village operator Aveo is making a fortune by ripping off Australians through complex contracts and eye-watering exit fees).

Wraparound Mortgage Scam Leaves Couple Facing Foreclosure Despite Having Made All House Payments; Real Estate Operator Who Sold Home Suspected Of Stiffing Lien-Holding Bank After Collecting Monthly Payments From Victims

In Tucson, Arizona, KVOA-TV Channel 4 reports:
  • The dream has turned to panic for Jan Ngo and her husband, Alan.

    They and their three children hope to stay in their Midvale Park home for a long time. They bought the house in 2014 for $99,000, and say they've spent more than $20,000 on improvements, including a new roof, solar panels and interior renovations.

    Referring to the time they moved in, Jan told the News 4 Tucson Investigators, "I was extremely excited. It was part of the American dream that everybody owns their own home, and, you know, you come to a home. So it was wonderful and the kids were so excited. This is our first home."

    The couple's dream was disrupted in March. That's when they received a Notice of Intent to Foreclose from Chase Bank. Jan says "I was completely stumped, I was worried, I was upset. I've been paying on time every single month and didn't understand why would we be going through foreclosure if we had paid every single month on time."

    Alan says he bought the home from a man the News 4 Tucson Investigators have reported on before, David Kinas. In 2015, Mark Brnovich became the second Arizona Attorney General to investigate Kinas. The A.G's office said Kinas engaged in deceptive rent-to-own practices. We reached out to Kinas at that tine, attempting to interview him outside his office. He did not stop. We asked, "Hey, why are you walking away? We want to ask you about the attorney general's lawsuit."

    Records from the Arizona Corporation Commission show Kinas is affiliated with companies called "881 Home" "Deed and Note Traders" and "Olympic Holdings." Alan Nguyen says he paid the monthly mortgage of $887.93 dollars in person at 881's office, and got receipts.

    However, there was a lien on the home, with Chase Bank.

    Attorney Richard Luff is suing Kinas, his wife Deanne, "Deed and Note Traders" and "881 home" on behalf of Jan and Alan. The "Wraparound" mortgage that Alan signed says Deed and Note Traders was supposed to advance his payments to Chase. Luff said "Chase Bank, I just got off the phone with them. They're indicating to me their last payment was in November 2015."

    We asked Luff what happened to his clients mortgage payments since then. He said, "That is an excellent question, and we don't have any answer to that at this point."

    Kinas did not return our call. His attorney, Scott Gibson, last week declined an on-camera interview but said on the phone that he'll "move to dismiss the lawsuit." He did not elaborate. However, in a court hearing on Monday, Gibson blamed Chase, saying Kinas made all the payments and the bank is wrong. Outside the courthouse, we did not ask Gibson any questions, and he did not want to be recorded. Gibson said, "I don't want to be on. I told you once."

    One other thing about the mortgage Alan Nguyen signed: the names "Michael" and "Mary" are listed at the top. Apparently, it was a copy that wasn't changed when given to Alan.

    Pima County Superior Court records show many lawsuits filed against Kinas and his companies over the years. Southern Arizona Legal Aid,(1) which represents low income residents, won a fraud case against Kinas three years ago. The plaintiffs were awarded $5767.60 and Legal Aid was awarded $30,000 in attorneys' fees. Legal Aid Managing Attorney Beverly Parker says Kinas has not paid both parties.

    Parker said she has seen a trend in cases involving Kinas. "We have clients who come in who believe they've bought homes, or are in the process of buying homes, and all of a sudden they received a notice of trustee sale on their door," Parker said.

    There's more: the Arizona Department of Real Estate recently filed a "Cease and Desist order" against Kinas and three companies he's with. The agency says Kinas and the firms are not licensed. The order says "881 advertised real estate for sale and lease that were not owned by 881. The properties were owned by other entities or individuals." Kinas' lawyer told us on the phone: "That's a true statement and we have ceased and desisted."

    Jan Ngo said, "I'm very, very disappointed in the attorney general's office because this has been going on for so long."

    In 2006, Kinas agreed to a settlement with the attorney general that involved his foreclosure-assistance business. Kinas was ordered to pay restitution to former clients, and pay $200,000 to the attorney general's office for the cost of the investigation. "It hasn't stopped him," says attorney Beverly Parker of Legal Aid. "I wish it did. But it hasn't stopped him."

    Jan Ngo said, "Somebody needs to put a stop to it."

    Deed and Note Traders" filed for bankruptcy in 2010. The case is still ongoing.

    Alan Nguyen and his wife obtained a temporary restraining order last week that puts a hold on the foreclosure proceedings. Attorney General Brnovich declined an interview through a spokesperson. We don't know if he's investigating David Kinas again. We do know the A.G. does not comment on investigations until they are completed.
Source: N4T Investigators: American nightmare.
(1) Southern Arizona Legal Aid is a non-profit, public interest law firm that provides free, civil legal aid to qualified low-income persons who would not otherwise have access to Arizona's civil justice system throughout southern and southeastern Arizona (covering a nine-county service area). land contract for deed

Indianapolis-Area Real Estate Peddler Accused Of Using Predatory 'Land Contract' Business Model To Create Mirage Of Homeownership; Use Of Short-Term Balloon Payments Leaves Many Unsophisticated Homebuyers Holding The Bag

In Indianapolis, Indiana, The Indianapolis Star reports:
  • Home ownership seemed out of reach to Ashley Glenn. That is, until a friend told her about an Indianapolis company run by Christians who help people that don't qualify for traditional mortgages.

    She reached out to Chart Properties LLC in October, and the next day she forked over about $5,000 and moved into a newly remodeled home on the Far Eastside. It was a dream come true, she said, at a time when her growing family was in a bind.

    But in May, a real estate agent showed up and planted a For Sale sign in the front yard of the home on Chateau Drive that Glenn thought she had purchased from Chart. The unexpected event turned Glenn's life upside down and placed her among a growing number of buyers and sellers disillusioned by their dealings with the Indianapolis real estate business.

    An IndyStar investigation found Chart has more than 100 contracts for the purchase and sale of homes from which it stands to make millions of dollars flipping properties it doesn't actually own. The buyers, in many cases, are people who really can't afford the homes or are unprepared for home ownership.

    In contract sales, unlike purchases made with cash or a traditional mortgage, the buyer makes monthly payments but the property remains in the name of the owner until the contract is paid in full. That means Chart does not typically own the homes it sells, but rather has a contract that allows it to sell the home on behalf of the owner.

    The investigation — prompted by a seller who reached out to IndyStar Call for Action — revealed Chart targets unsophisticated sellers and buyers and, according to former employees, often uses high-pressure pitches to close deals that fair housing advocates call one-sided and potentially "predatory."

    The Chart business model is built on a series of land contracts that allow the company to profit from buying and reselling, often with little or no investment by the company. It's a twist on rent-to-own, with the new buyer bearing nearly all the risks and costs — often including the money Chart uses to make monthly payments to the seller and what former employees described as the company's target profit margin of at least 28 percent.

    Contract sales often set up vulnerable people to fail, fair housing advocates told IndyStar. Defaults actually benefit the business in the deals that are not covered by Indiana real estate laws. It's a potential trap for the poor, they say, that Indiana lawmakers need to address.

    "Homeownership through these deals was often a mirage," the National Consumer Law Center warned in a 2016 report,(1) "and buyers lost their homes, their down payments, their sweat equity, and the money they paid for repairs."
    Here's how the Chart system, which Keck said was developed in the 1980s by [partner Grady Brian] Rogers, works:
  • Chart enters into contracts with sellers that allow the company to take immediate possession of a home in exchange for monthly payments over a designated period of time. Those payments are meant to cover the seller's mortgage obligation. Chart assumes responsibility for insurance and taxes. The contract term is typically five years, with a balloon pay-off due from Chart at the end. Until that time, the property remains in the name of seller.
  • Once Chart secures a signed purchase agreement and the keys, it re-sells the home on a second contract — sometimes as quickly as promised in the "same day" pitch. The deal requires a small down payment, followed by monthly installments that covers Chart's purchase costs, and a full pay-off at the end of one year.
  • Since late 2015, Chart has contracted to purchase and sell more than 60 homes, according to Keck. But only one of those deals, so far, has culminated in a pay-off to the original seller and the transfer of title, Keck said.

    Keck did not provide a number, but acknowledged some buyers also have defaulted. In those cases, under the sales contract, the buyer can be evicted and lose their down payment, the monthly payments they've made, and everything they spent on improvements.

For more, see ‘Homeownership was a mirage’: How home buyers say their American dream became a nightmare.
(1) Toxic Transactions: How Land Installment Contracts Once Again Threaten Communities of Color. land contract for deed

Sunday, July 02, 2017

Like Father, Like Son? Six Years After Lawyer-Dad Found Guilty Of Fleecing Dead Client Out Of $900K+, Lawyer-Son Gets Pinched For Allegedly Stealing Hundred$ Of Thousand$ From Deceased Clients (& Their Heirs, Beneficiaries); Cops: Loot Included Sale Proceeds Of One Victim's Home

In Sarasota, Florida, the Sarasota Herald-Tribune reports:
  • A family whose members said they are victims of a Venice lawyer arrested Tuesday [June 6] for exploiting the estates of at least three elderly clients said they were going to use the money from their deceased uncle’s estate to pay for their children’s college education in the fall.

    The family said they spoke to detectives Friday morning [June 2] and that estate attorney Adam Miller, 38, of Venice has not been charged in connection with their case yet. A family member, who wished to remain anonymous, said that Miller was placed in charge of their uncle’s estate after he died in 1999.

    All I know is that my children’s trusts are gone, almost $500,000,” the woman said. “My youngest was supposed to start college after summer vacation; my oldest daughter has two small children, and my son is only 10.

    “I can’t believe that he did this, I find it so unreal.”

    The woman said that even after Raymond Miller — the father of Adam Miller — was arrested in 2010 and sentenced to four years in prison for stealing nearly $1 million from the estate of Holocaust survivor Beila Millet of North Port, her aunt transferred the account to Adam Miller.

    The aunt passed away in 2014, the woman said.

    “It makes you lose trust; my children are devastated,” the woman said.

    The woman said her uncle made his money operating bowling alleys. She said she expected detectives to file charges in connection with their case this week.

    On Tuesday, Adam Miller was charged with one count of exploitation of elderly, and three counts of scheme to defraud three different estates. He allegedly misappropriated $408,850 from the estate of a deceased Englewood couple.

    Raymond Miller had pleaded no contest to a charge he stole $941,256 from Beila Millet of North Port. She reportedly survived medical experiments in a Nazi concentration camp.

    As part of the plea agreement, Raymond Miller was sentenced to four years in prison and was placed on probation until he paid back the money.

    Millet had left the money to Israeli hospitals, schools and veterans’ groups when she died at age 93 in 2006. Raymond Miller only disbursed about $122,000 within months, but more than 50 beneficiaries never received their money, which is now gone.

    According to the Sarasota County Sheriff’s Office:

    Adam Miller, who was not involved in the 2010 case, also was tapping into the trusts of his clients.

    George and Eileen Johnston hired Adam Miller as their trustee and power of attorney in August 2013 to control six financial accounts, but immediately following their deaths (Eileen in 2014, and George in 2015) Adam Miller allegedly began to write and deposit high-dollar checks to himself or his law firm from accounts belonging to the Johnstons’ Trust. The funds were beyond normal attorney’s fees, detectives stated in the report.

    Financial records show that Adam Miller received an estimated $130,000 from the Johnstons’ Englewood Bank account from July 2014 until George Johnston died in Febrary 2015. The attorney also received an estimated $24,500 from a Fifth Third Bank account from November 2014 until November 2015. The checks were drawn by Miller or counter withdrawals.

    After the sale of the Johnstons’ Englewood home in March 2015, Adam Miller opened an Englewood Bank and Trust account to deposit a check for $264,389.37 under an account titled “George and Eileen Johnston Trust.”

    Adam Miller allegedly received another $231,000 from the Englewood bank account from November 2015 to March 2016.

    Detectives determined that Adam Miller paid the Johnstons’ beneficiaries only $25,500 after the couple’s deaths. None of Adam Miller’s business or personal bank accounts show the funds being disbursed to beneficiaries, the sheriff’s report said.

    Sheriff’s detectives, along with the FBI, executed a search warrant on Adam Miller’s business and home and identified at least two other estates that were allegedly victims of fraud.

    The Sheriff’s Office said the investigation is ongoing and additional charges could be filed in the case.
Source: Venice lawyer charged with stealing over $400K from elderly clients.

For a story update, see Venice estate lawyer faces new charges:
  • Adam R. Miller, a former elected member of the Sarasota County Charter Review Board and a Venice attorney accused of stealing from the estates he was hired to protect, is facing a new charge, according to the Sarasota County Sheriff’s Office.

    Another scheming to defraud charge was lodged against Miller stemming from the case of a Venice family. He had already been charged with exploitation of the elderly and three counts of scheming to defraud three other estate trusts.

    He was first elected to the Charter Review Board in 2006 and attended his last meeting Jan. 18, 2012. His term ended in 2014, according to a Sarasota County spokesman.

    The charges were similar to those against his father, disbarred Venice attorney Raymond Miller, who was found guilty in 2011 and served four years in prison.
    According to the Sheriff’s Office:

    Detectives investigating the cases of three victims discovered another possible victim in Venice.

    Miller allegedly opened four accounts under the estate of the Venice woman in 2014, but over a one-year period withdrew an estimated $528,482 and deposited funds into his personal account and business accounts. Only minimal disbursements were made to the beneficiaries of the Venice woman who died in January 2014, detectives said.

    A member of the Venice woman’s family, who wished to remain anonymous, said the money from the trust was going to be used for the college education of children in the family, including a daughter who starts college in the fall.

    “I can’t believe that he did this; I find it so unreal,” said the family member of Adam Miller.

    The family member said the money belonged to their uncle, who operated two area bowling alleys. Even after Raymond Miller was found guilty of stealing $941,000 from the estate of Holocaust survivor Beila Millet, the family member said their aunt trusted Adam Miller enough to transfer the account to him. POA abuse

Soon After Getting Bar Boot For Allegedly Siphoning Cash From Client Trust Account, Ex-Lawyer Now Faces Civil Lawsuit Accusing Him Of Swiping $176K Paid By City When It Took Clients' Real Estate In Eminent Domain Case

In Tallahassee, Florida, the Tallahassee Democrat reports:
  • A group of Tallahassee residents is suing their former attorney, Henry C. Hunter, alleging he pocketed $176,275 given to them by the city in exchange for their land in an eminent domain case.

    The plaintiffs also named the city as defendants, alleging it failed to put the money in a court registry and instead gave it directly to Hunter, whose law license was revoked in April. In a separate lawsuit, the plaintiffs are suing the city, claiming it doesn’t have legal title to the land.

    “These people are in a terribly unfortunate situation of having a governmental entity come in and take their property,” said one of their attorneys, C.B. Upton of Tallahassee. “And then the payout from the lawsuit for their property — they didn’t get any of it because their lawyer stole it.”

    According to the lawsuit, Hunter and the city entered into stipulated order on the land in 2013 that awarded the money to the plaintiffs. At the time, Hunter didn’t notify the plaintiffs about the agreement.

    The lawsuit says that under Florida statutes, the money was supposed to be deposited into the court registry. Instead, it was deposited in Hunter’s trust account. The plaintiffs didn’t learn about the cash until after Hunter collected.

    “Hunter never paid plaintiffs any of the $191,375 awarded to them under the stipulated order, although he repeatedly stated that he intended to release the funds to them in the near future,” the lawsuit says.

    Last year, the Florida Bar began investigating Hunter and found he misappropriated $351,000 in client funds from his trust fund account. Hunter, a former attorney for the city of Midway, didn’t contest disciplinary action against him. In April, the Florida Supreme Court permanently revoked his license in an action tantamount to disbarment.

    The plaintiffs are Chalmus Thomas, Cicero Hartsfield, Janie Reddings and Alveria Redding. Tallahassee attorney Stan Chapman also is representing the plaintiffs.

    “As an attorney and member of the Bar myself, it doesn’t get any more egregious than stealing money from a client,” Upton said. “That violates all of our oaths and trusts and just basic human decency.”

Los Angeles Feds Pinch Lawyer For Allegedly Draining $250K In Trust Funds Left By Dead Client For Designated Beneficiary; Indictment: Pilfered Cash Included Illicitly-Obtained Mortgage Proceeds Secured By Victim's Real Estate, Which Was Later Sold Off To Pay Off Loan

In San Luis Obispo, California, The Tribune reports:
  • A San Luis Obispo attorney is facing federal wire fraud charges after an investigation revealed he allegedly stole hundreds of thousands of dollars from a client, much of which he spent at casinos in California and Nevada.

    Stephen Christopher Ronca was arrested on Thursday [June 15] at his home in San Luis Obispo and was arraigned before a U.S. magistrate judge in Los Angeles, according to Thom Mrozek, a spokesman for the U.S. Attorney’s Office. He pleaded not guilty to 28 counts of wire fraud and was released from custody in lieu of $100,000.

    Each of the fraud charges carries a maximum charges of 30 years in federal prison.

    According to a federal indictment, Ronca is accused of stealing approximately $250,000 from a San Luis Obispo client, identified as S.K. The attorney had access to S.K.’s living trust, which she inherited from a man identified as K.K. Ronca set up the trust in July 2000, and S.K. became beneficiary when K.K. died in 2012.

    Ronca is accused of transferring money from the trust account into his personal checking account for his own use.

    He allegedly withdrew some of this money using ATMs in Las Vegas, South Lake Tahoe and at the Chumash Casino in Santa Ynez, among other locations. In some cases, he allegedly wrote and deposited checks made out to himself and cashed checks made out to “cash.”

    Ronca is also accused of using a property included in the trust, located on Poinsettia Street in San Luis Obispo, as collateral for a nearly $90,000 loan. To pay off the loan, Ronca then sold the property.

    By February 2014, Ronca had allegedly drained the trust account.

Pinched Lawyer Accused Of Stealing From 'Wrong' Clients, Allegedly Stiffing Pair Of City Cops Out Of $80K Pocketed From Lawsuit Settlement

In Gary, Indiana, The Northwest Indiana Times reports:
  • The Indiana State Police have arrested an attorney and charged her with felony theft.

    State police say attorney Ruth Batey cashed a check for $80,000 that was intended for her client, but she kept the proceeds.

    The investigation by Detective Gary Runde began in January, when the Gary Police Department asked Indiana State Police to investigate this case involving an alleged theft of money by Batey from two Gary police employees.

    According to the probable cause affidavit, Batey represented Shane and Robin Bolde, both Gary police officers. Shane Bolde was in a traffic accident while on duty on March 23, 2014. They signed a power of attorney for Batey to represent them in the case, the affidavit states.

    In July 2015, they discovered that Farm Bureau Insurance had sent a settlement check to them in the amount of $80,000 made payable to Shane and Robin Bolde, and to Ruth Batey as their attorney. The check to the couple was dated July 9, 2014. The check had been signed by Batey and was deposited into her Interest on Lawyer Trust Account (IOLTA), the affidavit states.

    A second check issued by Farm Bureau General Insurance of Michigan in the amount of $8,750 was cashed and deposited into Batey's business account, the affidavit states. The affidavit said none of the money Batey received on behalf of the couple had been dispersed to the couple.

    Batey, 46, of Gary, who practices law in Chicago, was taken to Lake County Jail in Crown Point and charged with Level 5 felony theft.

    In a news release, Indiana State Police said it also was discovered Batey had a civil warrant. Batey was booked on a $20,000 bond plus an additional $500 bond on the civil warrant.

Minnesota Supremes Give Criminal Defense Attorney Bar Boot For Filching $67K+ From Two Clients While They Were Incarcerated

In Minneapolis, Minnesota, the Minnesota Lawyer reports:
  • In a 2011 YouTube video, criminal defense attorney Geoffrey Saltzstein pitched himself to prospective clients as a straight shooter who would always treat them “with the respect they deserve.”

    “What you need is someone who is going to talk straight to you,” said Saltzstein, who was employed at the time as an associate at a small shop in St. Louis Park, the Appelman Law Firm. “I talk straight, and I’m honest and upfront with all my clients.”

    But in a per curiam decision disbarring Saltzstein on Wednesday [June 21], the Minnesota Supreme Court cast the 39-year old Edina lawyer in a far less flattering light — that of a slick operator who stole tens of thousands of dollars from his clients while they were behind bars and then ignored them.

    In addition to misappropriating more than $67,000 from two prison inmates, the court found that Saltzstein had violated “a wide array” of the rules of professional conduct in his dealings with at least four other clients.

    Those violations, the court said, included “a pattern of neglect and failure to communicate with clients, entering into improper fee agreements with several clients, and failing to place clients’ funds in trust and properly account for those funds.”

    In the case of one jailed client, according to the court, Saltzstein didn’t just steal the client’s money; he also failed to file the brief the money was set aside to pay for, which caused the client to forfeit his appeal.

    The court also found that Saltzstein didn’t deliver on a promise to pay $38,000 in premiums on a life insurance policy on behalf of the same incarcerated client.

    According to Avery Appelman, Saltzstein worked at his firm for about five years.

    In a phone interview, Appelman said was impressed by Saltzstein when they met, saying he came across as “smart, bright, and exceptionally personable.” At the time, Saltzstein, a 2009 graduate of the University of St. Thomas School of Law, was clerking for Hennepin County District Court Judge Philip Bush.

    About a year later, Appelman hired Saltzstein.

    He said his first inkling that something was amiss came in January 2015 when a client sued the firm, demanding the proceeds of a civil settlement that he had entrusted to Saltzstein while serving out a felony sentence.

    Although Saltzstein deposited the $28,000 in a mutual fund, according to the court, he later made a series of unauthorized withdrawals and, in the end, only $1.75 remained in the account.

    Appelman said he terminated Saltzstein the same day he was served with the lawsuit, which was later settled confidentially.

    “I felt betrayed. I felt humiliated and embarrassed,” said Appelman. “I did what I could to make things right with the clients. But it became abundantly clear that the person I knew Geoff to be is not who he is.”

    After conducting a forensic accounting and uncovering additional evidence of malfeasance, Appelman said he submitted a complaint to the Office of Lawyers Professional Responsibility.

    He praised Bing Tuong, the assistant director at the OLPR who lead the disciplinary investigation in Saltzstein.

    Appelman said at least two of Saltzstein’s former clients hope to see him prosecuted, and he plans to present evidence to Edina police in coming weeks. In Appelman’s view, there is enough to merit a charge of felony theft-by-swindle.

    Saltzstein, who did not participate in the OLPR’s disciplinary proceedings, could not be reached for comment.

    In addition to losing his law license, Saltzstein has been sued four times this year over unpaid debts, including an outstanding $27,000 credit card balance.

    Last year, according to Hennepin County District Court records, Saltzstein pleaded guilty to a fifth-degree drug charge for attempting to pass a forged Adderall prescription. He received a 60-day sentence and immediate furlough for treatment but, in April, was sentenced to 30 days over a probation violation.