Fraud and Prevention

Seven Charged in Fraud Scheme Involving More Than 100 California Properties

By James Comtois
November 18, 2009

Seven individuals have been charged for their roles in a mortgage fraud scheme that involved more than 100 properties in Northern California. The indictment charges Amy Schloemann, Karim Akil, Wonda Louise Kidd, Michelle McGuire, Kaska Clay, James Ross and Darnell Thomas with conspiracy to commit wire fraud, wire fraud and money laundering.

According to Joseph P. Russoniello, U.S. attorney for the Eastern District of California, the defendants, who were unavailable for comment, allegedly participated in a fraud scheme involving the purchase of more than 100 properties through the use of straw buyers, real estate appraisers, notaries and escrow agents and the laundering of profits.

The defendants allegedly directed straw buyers to sign loan applications containing false information and allegedly hired notary publics to fraudulently notarize documents. The defendants allegedly increased their profits on the purchase of properties by submitting false documents to lenders. Once the properties were purchased, the defendants allegedly split the proceeds and failed to make payments on the properties, causing lenders to foreclose.

Ms. Schloemann, also known as Amy Kinney, was a licensed Realtor and president of Hiddenbrooke Mortgage in Vallejo, Calif. She allegedly completed and caused others to complete false loan application for straw buyers and fictitious buyers. She also allegedly acted as a real estate broker for both straw buyers and fictitious buyers.

Ms. Schloemann's husband, Mr. Akil, a k a Scott Kinney and Scott Kenny, was the president of Marsh Group Corp. in Oakland, Calif. Mr. Akil allegedly employed and paid co-conspirators to recruit individuals to act as straw buyers of real estate.

Ms. Schloemann and Mr. Akil held signature authority on business checking accounts in the names of Hiddenbrooke Mortgage Group, Marsh Group, Brooke Property Management Co. and Sanford and Son MTG. They allegedly used these accounts to launder the profits of the fraudulent scheme, to make deposit payments on real property purchases in the names of straw and fictitious buyers and to make payments to co-conspirators.

Ms. McGuire worked as a personal assistant for Mr. Akil. She was allegedly responsible for assisting in the completion of loan applications for straw buyers and fictitious buyers and submitting these loan applications and supporting documentation to lenders. She was allegedly paid hundreds of thousands of dollars for her involvement in the fraud scheme.

Ms. Kidd was a manager and escrow officer of Financial Title Co. in Castro Valley, Calif. Ms. Kidd was allegedly the escrow officer on more than 100 properties involved in this scheme, disbursing profits to Ms. Schloemann and Mr. Akil through wire transfers and checks to their various accounts.

Mr. Ross and Mr. Thomas allegedly worked with Mr. Akil to recruit straw buyers to purchase real property. Mr. Thomas also allegedly falsified information on a loan application submitted to a lender for a property he purchased. They were each allegedly paid hundreds of thousands of dollars for their involvement.

Mr. Clay, a k a Mark Lane and Michael Lewis, was a real estate agent who allegedly purchased two properties using the alias Mark Lane. Mr. Clay also allegedly authorized the use of his telephone number to falsely represent to lenders that Clay's number belonged to a certified public account.

The case is assigned to U.S. District Judge Phyllis Hamilton. The defendants are scheduled to make their initial appearance before Judge Hamilton on Nov. 25.