ELEVEN PEOPLE CHARGED IN NEW JERSEY $15 MILLION MORTGAGE FRAUD SCHEME WHICH INCLUDES ATTEMPTED MURDER OF A WITNESS
FACTS
On July 17, an indictment was issued in New Jersey charging 11 individuals from five states a for their alleged roles in a $15 million mortgage fraud scam that used phony documents and straw buyers to make illegal profits on overbuilt condos, including a defendant who attempted to murder a witness to the scheme.
Willie W. Richardson, Sean A. Souels, Nancy E. Wolf-Fels, Deborah L. Hanson, Seth A. Fuscellaro, Larry L. Fullenwider and Angela L. Celli are in federal custody following their arrests July 19, by special agents of the FBI and IRS–Criminal Investigation.
Dwayne K. Onque surrendered to authorities the same day. Timothy D. Ricks and Orlando Allen were expected to surrender to federal authorities, while Kinard J. Henson was already in federal custody in Alabama.
All 11 defendants are charged with conspiracy to commit wire fraud. Additionally, Ricks, Henson, Richardson, Allen, and Onque are charged with conspiracy to commit money laundering. Henson is also charged with the attempted murder of a straw buyer who was a witness to the mortgage fraud scheme.
“According to the indictment, these defendants created false documents and used straw buyers to convince lenders to give them $15 million for properties that were worth far less,” said U.S. Attorney Paul Fishman. “Members of the scheme were willing to launder money—and even to kill—in order to get their hands on the profits and cover their tracks.”
According to the superseding indictment, Ricks and his co-conspirators located oceanfront condominiums overbuilt by financially distressed developers to purchase, negotiating a buyout price with the sellers of the properties. They then caused the sales prices for the properties—located in Wildwood Crest and North Wildwood, N.J.; other locations in New Jersey; and in Naples, Fla.—to be much higher than the buyout price to ensure large proceeds. Celli and Fuscellaro helped conceal the true sales prices of certain properties through inflated sales contracts and sale and finder fee agreements.
Ricks, Henson, Allen, and Souels then recruited straw buyers, such as Fullenwider and Onque, to purchase those properties at the inflated rates. The straw buyers had good credit scores but lacked the financial resources to qualify for mortgage loans. The conspirators' created false documents such as fake W-2 forms, pay stubs, bank statements, and investment statements to make the straw buyers appear creditworthier than they actually were in order to induce the lenders to make the loans.
To prepare the straw buyers’ false loan applications, Ricks and his conspirators caused fraudulent mortgage loan applications in the names of the straw buyers, including the supporting documents, to be submitted to mortgage brokers—including Wolf-Fels and Hanson—that the brokers knew were false, attributing to the straw buyers inflated income and assets. Once the loans were approved and the mortgage lenders sent the loan proceeds in connection with real estate closings on the properties, Ricks and his conspirators took a portion of the proceeds, having funds wired or checks deposited into various accounts they controlled. They also distributed a portion of the proceeds to other members of the conspiracy for their respective roles.
Henson learned of a subpoena seeking documents in connection with a straw buyer’s purchases of real estate properties shortly after it was served by federal law enforcement agents on a mortgage brokerage firm. Henson, who had recruited the straw buyer, contacted another individual to kill the straw buyer. They then lured the straw buyer to a wooded area in Mobile, Ala. At Henson’s direction and using Henson’s firearm, the other individual shot the straw buyer multiple times.
The wire fraud conspiracy charge carries a maximum potential penalty of 30 years in prison and a $1 million fine. The money laundering conspiracy charge carries a maximum potential penalty of 10 years in prison and a $250,000 fine. The attempted murder of a witness charge carries a maximum potential penalty of 30 years in prison and a $250,000 fine. (usattynj71912)
MORAL
Can you imagine? They allegedly lure the straw buyer to a wooded area, they are alone, they allegedly shoot the buyer “multiple times” and still the straw buyer lives!
CALIFORNIA HOMEOWNER STOPS FORECLOSURE BECAUSE LENDER DID NOT COMPLY WITH STATE PRE-FORECLOSURE RULE
FACTS
Andrea Skov filed a lawsuit against U.S. Bank as trustee for Credit Suisse First Boston SCFB 2004-AR3 and others alleging improprieties in the nonjudicial foreclosure process involving her residence. The trial court upheld a demurrer (failure to state facts upon which to sue) to the second amended complaint and dismissed the lawsuit. She appealed alleging the trial court improperly took judicial notice of various recorded documents and therefore her second amended complaint for wrongful foreclosure was proper.
The 6th Appellate District said reversed. The homeowner can sue. Although the notice of default had the declaration required that the lender had complied with the law and had contacted or attempted to contact the homeowner before filing the notice of default to discuss her options to avoid foreclosure prior to filing the notice of default, the court cannot take judicial notice of the truth of the statement in the recorded document. It can only judicially notice the document was recorded with the county recorder not that the facts stated therein are true!
While the court can judicially notice the beneficiary of the deed of trust, it cannot judicially notice the truth of statements that the beneficiary did meet or attempt to meet with the borrower to avoid foreclosure. The beneficiary must contact the borrower “in person or by telephone in order to assess the borrower’s financial situation and explore options for the borrower to avoid and foreclosure” or satisfy due diligence requirements before a notice of default is filed. However, the only remedy to the borrower is to postpone the sale.
Plaintiff had alleged in her complaint that she was fully available to meet with U.S. Bank to explore foreclosure options, she had hired attorneys or other representatives who telephoned and sent letters to the bank where were unanswered and that U.S. Bank failed and refused to evaluate her finances to advise her of her right to meet with U.S. Bank to discuss foreclosure avoidance options and the bank failed to give her the HUD telephone number and therefore U.S. Band failed to comply with Section 2923.5. Further, the bank did not contact her at all until after it had filed the notice of default. The bank asked the court to take judicial notice of its declaration that it did attempt to contact her and the trail court should not have done so since this was a fact that was disputed and therefore the plaintiff could take the issue to trial. (Skov v. U.S. Bank National Association (6-8-12), 2012 DJDAR 9337, Santa Clara County CV153635))
MORAL
If you can legitimately alleged this then you can stop the sale temporarily. But note the court did not give her money and said she was only entitled to postpone the sale. So she would still need to come up with the balance if the bank did not want to modify the loan.
FORMER SAN DIEGO POLICE OFFICER AND WIFE GET 9 MONTHS IN PRISON FOR TRASHING THEIR HOME AND TAKING FIXTURES AFTER THE FORECLOSURE
FACTS:
On July 20, Robert Conrad Acosta, a former San Diego police officer and his wife Monique Evette Acosta, were sentenced to 270 days in jail and five years' probation. They had been convicted in May 2012 on one felony count each of stealing fixtures valued at greater than $65,000 when they moved out of their foreclosed home in 2010. The pair also vandalized the property.
The judge also ordered them to pay restitution, which was set at $144,000 by the probation department. It is unclear, however, when the Acostas might be able to begin repaying that amount because they are bankrupt, the judge acknowledged.
Because the couple has a 5-year-old daughter, the judge said they could stagger their jail terms so that both parents would not be incarcerated at once.
Robert Acosta was ordered to surrender July 27 to begin serving his time and Monique Acosta Dec. 27. They are each expected to serve half their sentences, assuming they receive credit for good behavior.
The day after the Acostas moved out of their home in 2010, authorities discovered the property had sustained more than $100,000 in damage, including missing doors, light fixtures, air-conditioning units, cabinets and granite countertops. There was dye poured on carpets, graffiti spray-painted on the walls, decorative rock smashed off the exterior of the house and wiring pulled out and cut, court records said.
Monique Acosta was photographed from a neighbor's home cutting down cypress trees in the backyard and Robert Acosta carrying away cabinet doors from the gutted kitchen. Investigators recovered many of the missing fixtures from a storage unit the Acostas rented in San Diego County.
The Acostas had bought the home in 2006, installed many upgrades and taken out a new mortgage for nearly $700,000 with San Diego Metropolitan Credit Union in 2007, prosecutor Marcus Garrett said.
They had demanded—but did not receive—$10,000 "cash for keys" in exchange for moving out and leaving the home in good condition. The judge summed up what he described as egregious damage to the house. "They took everything but the kitchen sink," he said, "which was left in the backyard." (rivprsent72112)
MORAL
It looks like it was trashed and the fixtures taken after the foreclosure sale. If true the fixtures belong to the new owner when the sale took place. Now because of a lot of anger, they have a heavy penalty to pay for it the rest of their lives.
TWENTY MORE INDICTED IN PUERTO RICO FOR MORTGAGE FRAUD
FACTS
On July 18, a grand jury returned a 45-count indictment charging 20 individuals with making false statements in loan applications, aggravated identity theft, and money laundering. The lead agency during this investigation was the Department of Housing and Urban Development-Office of Inspector General, with the collaboration of the Internal Revenue Service-Criminal Investigations, U.S. Secret Service, FBI, Immigration and Customs Enforcement-Homeland Security Investigations, and the Puerto Rico Commissioner of Financial Institutions. Notice that seven agencies got together to get to 20 more people!
According to the indictment, beginning on a date no later than in or about December 2008, up to and including in or about April 2010, defendants Carlos D. Cuevas-Diaz, Miguel Angel Echegaray-Gonzalez, and Lee A. Arcia-Centeno conspired and agreed with each other, and with diverse other persons known and unknown to the grand jury, to knowingly make false statements or cause false statements to be made to mortgage lending institutions Equity Mortgage, Latin American, and Express Solution for the purpose of influencing the Federal Housing Administration to insure the mortgage loans. The object of the conspiracy as alleged was to obtain monetary gain through commissions and/or revenues related to real property and/or loan transactions, including undisclosed payments from third parties and false or fraudulent liens, debts, or claims allegedly owed. As part of the manner and means by which the defendants and co-conspirators allegedly accomplished and furthered the object of the conspiracy, defendants would recruit straw buyers who at times received monetary compensation for their participation in the offense. The defendants and their co-conspirators knowingly submitted and caused to be submitted false and fraudulent information to the mortgage lenders to fraudulently procure mortgage financing for the real property transactions. This false and fraudulent information included, among other things, the purchaser’s occupation and place of employment, income, time at employment, assets and intent to occupy the property.
The indictment further alleges that it was a part of the manner and means of the unlawful conspiracy that the defendants and their co-conspirators would distribute the illegally obtained proceeds of the real property transactions amongst themselves.
The defendants are: Carlos Daniel Cuevas-Diaz; Miguel Angel Echegaray-Gonzalez; Lee A. Arcia-Centeno; Carlos Luis Cuevas-Diaz; Germania Gil-Gil; Inmerta J. Perez Echevarria, aka “Maria Perez”; Jorge Paul Gonzalez-Gonzalez; Sonia E. Diaz-Rodriguez; Pedro Archilla-Colon; Olga M. Diaz-Medina; Gabriel Oliver-Vazquez; Oscar Piña-Fuentes; Patricia Perdomo-Regalado; Norman G. Ojeda-Marrero; Marleni De La Cruz-Ulloa; Federico Rivas-Rosario; Carlos Xavier Ortiz-Olivera; Jonathan E. Rivera-Santana; Nolin E. Cumba-Rodriguez; and Wanda Rodriguez-Colon.
Eleven defendants are facing money laundering charges and a forfeiture allegation of $535,048.89 in U.S. currency. Cuevas-Diaz and Arcia-Centeno are facing one charge of aggravated identity theft.
If convicted, the defendants charged for making false statements face a possible penalty of 30 years in prison. The defendants charged for money laundering are facing up to 20 years and the defendants charged with aggravated identity theft face a minimum of two years’ imprisonment. (usattypr71912)
MORAL
That should be one glorious trial to watch. If I cannot participate I sure would like to see it when it goes to trial.
THE INFORMATION CONTAINED HEREIN IS NOT LEGAL ADVICE.
AN ATTORNEY SHOULD BE CONSULTED IF YOU DESIRE LEGAL ADVICE
