Wednesday, December 06, 2006

DreamLife Financial CEO Pleads Guilty in $7M Real Estate Fraud Scheme

Tony J. Daniloo, 32, Turlock, California, the former President and CEO of DreamLife Financial, a Modesto, California real-estate brokerage company, pleaded guilty to 122 charges of fraud and money laundering in connection with a scheme to defraud homeowners and lenders of millions of dollars in cash.  Daniloo was indicted by a federal grand jury on August 31, 2006 and charged with 41 counts of wire fraud; four counts of mail fraud; and 77 counts of money laundering.

“Today’s guilty plea demonstrates that federal law enforcement will work to hold accountable those who would enrich themselves through real-estate fraud at the expense of innocent homeowners,” United States Attorney Kevin V. Ryan said.  “Fraud in real-estate financing can deprive homeowners of their life savings.  The victims in this matter were defrauded of millions of dollars, and I am pleased that the defendant is accepting full responsibility for the fraud scheme that he perpetrated.”

In pleading guilty, Daniloo admitted in open court that he defrauded real-estate lenders and clients in the East Bay and the central California valley of millions of dollars in cash that had been intended for the lenders and clients.  Pursuant to a plea agreement, Daniloo pleaded guilty to all 122 counts charged in the indictment.  Daniloo further admitted in the plea agreement that the loss amount for his fraud scheme was between $2.5 million and $7 million; that he derived more than $1 million in receipts from financial institutions; that he abused a position of trust; and that he served of an organizer or leader in a criminal activity.

From 2000 to 2002, Daniloo served as manager of the Dublin, California branch office of Residential Credit Corporation, a mortgage brokerage company based in Westminster, California. Daniloo admitted that while employed at Residential Credit Corporation, he created a scheme to defraud lenders by falsely claiming that liens existed on borrowers’ properties, duping lenders into funding these phony liens instead of the debts that lenders required be paid.  Daniloo then fraudulently paid himself “commissions” out of this extra cash.

In 2003, Daniloo co-founded DreamLife Financial, which maintained headquarters in Modesto, California and as many as seven branch offices.  Daniloo served as President and CEO of DreamLife Financial until it closed in December 2004.  Daniloo admitted in his guilty plea that he defrauded lenders and clients by using phony documentation to cause large amounts of cash—cash that had been intended to extinguish his clients’ former mortgages—to be deposited instead into his personal bank accounts for his personal use.  This fraud scheme resulted in many of DreamLife’s clients unwittingly ending up with two mortgages, not one.

In total, according to publicly-filed documents, Daniloo defrauded homeowners of nearly $7 million in cash that the victim homeowners had intended be used for their own cash needs.

Finally, Daniloo admitted to laundering his criminal proceeds by making numerous “lulling payments” to victim homeowners, as well as spending massive amounts of stolen money to garner publicity for DreamLife.  For example, according to the indictment, Daniloo made a $1 million pledge to the athletic department at California State University at Stanislaus, in exchange for the university renaming its athletic arena “DreamLife Arena.” In 2004, DreamLife was a finalist for naming rights of the San Francisco 49ers’ football stadium at Candlestick Point.

Daniloo remains in federal custody at North County Jail in Oakland, California.  His sentencing is scheduled for March 20, 2007.  The maximum statutory penalty for each count in the indictment is 20 years imprisonment, a fine of $250,000, and restitution. 

Roger L. Wirth, Special Agent In Charge of IRS-Criminal Investigation, said: “Mortgage fraud is a crime with many victims, including unsuspecting homeowners and lending institutions, who suffer significant losses while the perpetrators such as Mr. Daniloo pocket the proceeds for their personal benefit. IRS-CI is proud to be a part of the great team effort in this investigation and we will continue to contribute our financial expertise to help unravel complex financial crimes and money laundering schemes.”

Jean Mitchell, Special Agent in Charge of the U.S. Secret Service’s San Francisco field office, said: “This is another example of federal and state law enforcement working in a collaborative effort to stop the defrauding of innocent victims.  In this era of complex criminal trends, law enforcement needs to pool its resources and expertise to combat crime.”

mortgage fraud

1. I was employed with Dreamlife Financial, and I was given a check that was not cashable.  It was for loans that had supposedly closed.  I still have the check I was given.  Will I ever get paid the salary plus commissions owed?

   Sincerely,

   Phil Alfonso 209-430-6754

   Posted by  on  12/31  at  09:45 PM

2. Hey Whos ready to come to My new office in Downey .

   Posted by  on  12/26  at  11:44 PM