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Fidelity Settles California Kickback Case

JAN 31, 2013 3:45pm ET
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According to the affidavit in support of the criminal complaint, between August 2009 and April 2011, Mawhinney obtained four loans from Comerica Bank totaling approximately $6.25 million. Mawhinney defaulted on the loans, causing Comerica to suffer losses of approximately $6 million.   Mawhinney allegedly told bank officials that he needed the money to fund his music business and to purchase recording equipment. According to investigators, Mawhinney used the money from the Comerica loans and loans from other banks to pay for travel, entertainment and a luxury tour bus that cost well over $750,000.  The other banks that issued loans to Mawhinney and suffered losses were JP Morgan Chase, Zions Bank and Bank of America, according to court documents.

Mawhinney is charged with making a false statement in a loan application. If he is convicted of the charge in the criminal complaint, Mawhinney would face a maximum statutory penalty of 30 years in federal prison. Mawhinney is scheduled to be arraigned in this case on Feb. 11.

In a related case that was unsealed on Jan. 24, two former Mawhinney associates were charged with conspiracy to commit loan fraud. Matt Salazar and his brother Jason have agreed to plead guilty.

The Salazar brothers, who are co-owners of the Burbank-based Matt Salazar Recording Productions and part-owners of LA Sound Gallery, also based in Burbank, admitted in court documents that they provided false documents to Bank of America, Greystone Bank and Huntington National Bank to obtain about $1.7 million in loans for their music business.

Mawhinney also used the Salazars’ studio to bolster his own fraudulent loan applications. Mawhinney met with a Comerica loan officer at their recording studio and falsely claimed to be an owner of the studio.

The case against the Salazars has been assigned to United States District Judge Cormac J. Carney, who will schedule a hearing for the brothers to enter their guilty pleas. Once they plead guilty, each of the Salazar brothers will face a statutory maximum penalty of five years in federal prison.  (usattycdca12513)

MORAL

I do not think this is the type of publicity a rock band is looking for. I bet you can guess who is going to testify against Mawhinney. 

CALIFORNIA AG ARRESTS SIX PEOPLE FOR USING WEBSITES TO FURTHER MORTGAGE FRAUD SCHEME

FACTS

On Jan. 28, Attorney General Kamala D. Harris announced the arrest of three suspects who have been charged in a mortgage fraud scheme targeting struggling Northern California homeowners. Six websites allegedly used by the suspects to advertise their scheme have been intercepted and redirected to a resource page on the California Attorney General’s website.

The felony complaint alleges that Ronald Vernon Cupp deceived homeowners by falsely advertising a way to “kill” their mortgage debt on six websites including www.wekillyourmortgage.com. Cupp was assisted by Randall Gilbert Heyden and Angelle Wertz, a public notary who allegedly certified phony legal documents. Cupp allegedly recorded fraudulent documents, which would only delay a foreclosure, not actually satisfy the preexisting mortgage debt.

Cupp, Heyden and Wertz are charged in a 57-count complaint alleging theft, forgery, notary fraud and recording of false documents. They were booked at the Sonoma County Jail on Jan. 23. Cupp and Heyden are being held with bail set at $500,000 and $75,000 respectively.

Through Cupp’s business, North Bay Trust Services, homeowners would often allegedly pay upfront fees of between $1,000 and $10,000 and sign a promissory note or new mortgage for a phony offer to eliminate their mortgage debt. Requiring up-front fees is illegal in California. The suspects would then allegedly record fraudulent documentation purporting to be the attorney for the homeowner’s actual lender and then relinquish the mortgage and record a new deed of trust in favor of North Bay Trust Services. The debt to the original lender was never actually satisfied.

The following six websites have had their service suspended pursuant to a court order at the request of the Attorney General Harris’s Crime Unit:

http://www.northbaytrustservices.com/

http://wekillyourmortgage.com/

http://santarosatrustandtitle.com/

http://sonomafidelitytitle.com/

http://cortemaderafidelityandtitle.com/

http://marintrustandtitle.com/

These pages have been redirected to the California Attorney General’s website (http://oag.ca.gov/ecrime/doj-investigation) where individuals are able to file an online complaint form if they believe they may have been the victim of the scheme.  (caag12813)

MORAL

It would have been a lot cheaper to have the homeowner call a HUD Counselor or an attorney for one hour legal advice

CALIFORNIA WOMAN GETS 10 YEARS IN FEDERAL PRISON FROM FLORIDA FEDERAL COURT

FACTS

On Jan. 23, Lonett Rochell Williams was sentenced to 10 years in prison for conspiracy to commit mail fraud, conspiracy to commit money laundering, and six substantive counts of mail fraud.

In October 2012 Williams pled guilty to an eight-count indictment alleging that she participated in a conspiracy to defraud multiple lenders as part of a scheme to fraudulently purchase 37 properties located in Texas, Georgia, and California as well as in Navarre, Panama City Beach and Sarasota, Fla. Approximately $20,448,767 in loans were issued by the lenders in connection with the real estate deals. Williams and her company received more than $4.5 million in kickbacks as a result of the scheme.

In September 2011, Williams’ son, Raysean K. Richardson was separately indicted on charges of conspiracy to commit mail fraud, mail fraud, and conspiracy to commit money laundering based on his role in the scheme. Richardson was convicted following a jury trial held before Chief United States District Judge M. Casey Rodgers in September 2012. He is scheduled to be sentenced on Feb. 19. Richardson faces up to 20 years in prison on each of the three counts he was convicted on.  (usattyndfl12413)

MORAL

The next 10 years of her life is now shot. Was she the cause of her son getting involved? If so, some way to bring up a son. Since he gets sentenced after his mother, the chances are he offered testimony against her, I believe.

FLORIDA MAN PLEADS GUILTY AND GETS FIVE YEARS IN PRISON

FACTS

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