Bogus Loan Modification Scammers Arrested

**** UPDATE:  APRIL 20, 2020:  On April 15, 2019, after a nine day jury trial, Damon Grant Carriger was found NOT GUILTY on Count 5,8,10-11,14,17-18,21-22.   Aminullah Sarpas was found GUILTY on Count 1,5,8,10-11,14,17-18,21,24, and NOT GUILTY on Count 31. The jury DEADLOCKED on count 1 for Carriger and count 22 for Sarpas and the court declared a mistrial as to those counts. (Count 1 is Conspiracy to commit mail and wire fraud; Counts 2 through 27 are mail fraud, counts 28 through 31 are wire fraud, counts 32 and 33 are money laundering.)

Count 1 was retried as to Damon Grant Carriger and, following a four day jury trial on that count, on February 24, 2020, Damon Grant Carriger was found NOT GUILTY.

On August 31, 2015, Louis Saggiani pled guilty to conspiracy to commit mail and wire fraud.    The docket contains multiple documents filed under seal.  The trial memorandum filed by the government indicates that both Saggiani and Samuel Paul Bain had pled guilty.  None of the defendants have been sentenced. 

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Samuel Paul Bain, aka Paul Bain, 35, Tustin, California, an owner and principal of the businesses, Aminullah Sarpas, aka Amin Sarpas and David Sarpas, 32, Irvine, California, also an owner and principal of the businesses, Damon Grant Carriger, 36, Corona, California, the principal sales manager, and Louis Saggiani, 64, Huntington Beach, California, the manager and chief accountant, have been arrested for allegedly offering bogus loan modification programs to financially distressed homeowners.

Federal agents arrested the defendants who worked at Orange County, California, businesses that allegedly offered bogus loan modification programs to financially distressed homeowners. As a result of the fraudulent scheme allegedly run out of U.S. Homeowners Relief and several related entities, hundreds of financially distressed homeowners across the United States lost millions of dollars, and many victims also lost their homes in subsequent foreclosure proceedings.

According to the indictment, the four defendants operated a series of telemarketing “boiler rooms” that pitched loan modification services to distressed homeowners in the wake of the financial collapse in 2008. The defendants operated offices in Irvine, Santa Ana, Newport Beach, Garden Grove and Westminster under a series of company names from late 2008 to early 2010. Initially called Greenleaf Modify, they subsequently used the names U.S. Homeowners Relief, Waypoint Law Group and, finally, American Lending Review. The defendants would shut down each company name once their businesses attracted too many consumer complaints at the Better Business Bureau or attracted attention from state regulators such as the California Department of Justice.

The defendants and their associates used a consistent sales pitch throughout the scheme. According to the indictment, their advertising materials and telemarketers promised distressed mortgage holders that after paying advance fees ranging from about $1,450 to approximately $4,200, homeowners were highly likely to obtain a long-term modification to their current mortgage obligation, meaning they would have a lower monthly payment, an interest rate reduced to as low as 2 percent, and/or a reduction of principal. Many consumers were falsely told that their up-front money would be refunded if the promised loan modification failed to materialize.

The companies’ marketing materials implied that they were affiliated with a government program, sometimes making specific references to actual government websites, the indictment alleges. Telemarketers associated with the companies also told consumers that their mortgage relief services were part of the “Obama Act.” The defendants claimed in writing that one or more of the entities were licensed California real estate brokers and that payments would be placed in a trust account, not to be withdrawn until loan modification services were actually performed. The defendants often claimed that specific attorneys were assigned to work on consumers’ individual cases.

According to the indictment, all of the defendants’ claims were false and/or materially misleading. The vast majority of the hundreds of victims received no favorable loan modifications as per promises made by the defendants. Several of the victims learned from their mortgage lenders that the defendants’ companies had never made any contacts on the consumers’ behalf. The defendants’ companies were neither licensed real estate brokers, nor were they affiliated with any government program. The consumers’ funds were generally spent on the defendants themselves, on payments to sales people and other business expenses, and were not placed in trust accounts as promised. While the defendants paid attorneys to write substantially identical form letters to some lenders, the attorneys did not give personalized attention to the individual victims. The defendants routinely used stalling tactics or simply ignored consumers’ repeated demands for refunds after the customers did not receive their promised loan modifications.

The defendants are charged in a 33-count indictment. All four defendants are charged with conspiracy, 21 counts of mail fraud and two counts of wire fraud. Bain, Sarpas and Saggiani are charged in an additional five counts of mail fraud and two counts of wire fraud. Bain is also charged with two counts of money laundering.

The conspiracy count carries a statutory maximum penalty of five years in prison, while each of the mail fraud, wire fraud and money laundering charges carry a statutory maximum penalty of 20 years in prison.

The United States Postal Inspection Service, the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) and IRS – Criminal Investigation conducted the investigation which lead to the indictment.