Two California Men Convicted in Kansas Bankruptcy Scheme

Isaac Yass, an Israeli citizen living in Los Angeles, and Robert Andrew Blechman of Culver City, Calif., were convicted for running a scam in which homeowners who were behind on their mortgage payments paid them to hold off foreclosure by filing fraudulent bankruptcy petitions. During the trial, prosecutors presented evidence that Yass and Blechman conspired to operate a fraudulent service called Stopco claiming to be able to save homeowners who were behind on their mortgage payments from losing their homes. Evidence showed that Yass solicited homeowners who were going through foreclosure proceedings and told them that for a fee he could help them keep their houses. The defendants filed fraudulent bankruptcy petitions in federal bankruptcy courts in Topeka, Wichita and Kansas City, Kan. The petitions were filed in the name of nonexistent individuals with businesses that claimed to be part owners of properties that were in foreclosure. The result was an automatic stay in the foreclosures, halting any further actions by creditors against the properties. The defendants delivered the fraudulent petitions, which contained false names and Social Security numbers and addresses for the creditors that were in fact mailboxes or UPS Store locations in Kansas, to the bankruptcy court. Sentencing is set for May 11, 2009.