Seven suspects who have been charged in a mortgage fraud scheme that defrauded more than 1,550 Inland Valley, California, homeowners seeking loan modification services during the foreclosure crisis have been arrested.
The felony complaint alleges that Nehad “Nick” Ayyoub Ayyoub, 57, San Bernardino, California, and president of The Firm Loans, Insurance and Investments Inc. and First Choice Debt Solutions Inc., along with his six colleagues, Ghydan Ayyoub Rabadi, 38, Los Angeles, California, Zaid Rabadi, 49, Los Angeles, James Clemons, 55, Riverside County, California, Wissam Ismail, 32, Riverside County, Eddie Mercado, 57, San Bernardino, and Majid Safaie, 60, Orange County, California, deceived homeowners by illegally charging up-front payments for loan modification services and lying about the services they provided.
The suspects are charged in a 24 count complaint of felony grand theft, personal and corporate income tax evasion and conspiracy. The suspects were booked at Murrieta Detention Center, Orange County Jail, Rancho Cucamonga Jail and Azusa Police Department. Ayyoub is being held with bail set at $75,000 and all others are being held with bail set at $50,000. Ayyoub is facing a maximum exposure of 12 years in prison while his colleagues are facing a maximum exposure of 8 years.
According to court filings, Ayyoub and his colleagues took advantage of homeowners who were desperate to lower their mortgage payments by selling them home loan modification services and requiring payment of up-front fees. Homeowners were falsely told that attorneys would be negotiating their loan modifications, that they would get a loan modification with no risk of failure, that they would receive a refund if they were dissatisfied and that the suspects had special contacts with lenders, which would give them an advantage in obtaining lowered monthly payments.
Homeowners were instructed to stop paying their mortgage and to instead give the money to Ayyoub and his colleagues to ensure that they would obtain a loan modification, causing many victims to default on their home loans without obtaining a modification, according to court filings.
The suspects operated this scam from January 2007 to March 2010, according to court filings.
Attorney General Kamala D. Harris announced the arrests.
Attorney General Harris’ Mortgage Fraud Strike Force began investigating this case in 2010 yet business records were immediately sealed until September 2012 when Safaie’s claim of attorney client privilege was overruled.
Agents with the California Attorney General’s Bureau of Investigations were assisted by investigators with the State Franchise Tax Board.
Created in May 2011 by Attorney General Harris, the Mortgage Fraud Strike Force continues to lead the charge in investigating and prosecuting misconduct at all stages of the mortgage process
“These individuals profited from the fear and desperation of hard working Californians who were simply fighting to keep their homes during the height of our state’s foreclosure crisis,” Attorney General Harris said. “This kind of predatory activity is reprehensible.”