Mortgage Fraud Blog is the premier website for news and information on mortgage fraud and real estate fraud throughout the United States.
Rachel Dollar, the editor of Mortgage Fraud Blog, is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors. She is an author and a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is a shareholder with the law firm of Smith Dollar, PC, is licensed to practice law in California and maintains offices in Santa Rosa, California. Email Ms. Dollar
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Illnois Shuts Down Mortgage Rescue Scam Including Seven Title Agencies
Illinois regulators shut down a ‘mortgage rescue’ scam that defrauded vulnerable Chicago metropolitan area residents of their homes. The alleged scheme preyed on homeowners at risk of foreclosure and conned them into signing over the title and any earned equity from their properties, allowing investors to purchase the homes at a fraction of their market value.
“It’s unthinkable that any business would exploit people’s vulnerability and use it to cheat them out of their most valuable asset. Not only is it appalling from a moral standpoint, but it’s illegal. For any lender out there who might think they can get away with that kind of fraud, let this regulatory action serve as a reminder that we will not tolerate violations of our consumer protection laws,” said Gov. Blagojevich.
Following the Governor’s direction to aggressively enforce consumer protections, the Illinois Department of Financial and Professional Regulation (IDFPR) issued an emergency suspension of the loan originator registration of Charles T. White, Jr., and revoked the license of Mutual Trust Funding Corporation. IDFPR shut down seven title insurance agencies being charged with complicity in the “mortgage rescue” operation.
In a series of complaints, IDFPR charged that Mutual Trust, Charles White and seven title insurance agencies worked together to defraud unwary homeowners. Each of these entities has the right to an administrative hearing on the charges before the Department’s actions are final.
IDFPR alleged that in his capacity as a loan originator at Mutual Trust, Charles White approached homeowners facing imminent foreclosure and offered to find an investor who would borrow the money from Mutual Trust to purchase the property prior to foreclosure. Homeowners were told the new investor would then lease the home back to them while they attempted to regain their financial footing, and were promised that the new investor would repay the delinquent mortgage account and eventually resell the property back to them.
Instead of keeping the promise to repay delinquent mortgages and allow the original homeowners to re-purchase their properties, IDFPR found that up to $1.5 million of the loans arranged by Charles White through Mutual Trust, which should have been paid to the original lenders and previous owners, were diverted to a real estate management company called “Eyes Have Not Seen,” owned by White.
Further, documents detailing disbursements to previous lenders and current owners, which should have been notarized and filed with appropriate state, federal and financial offices had been tampered with to show that the new owner was in fact White, through his company “Eyes Have Not Seen.”
These fraudulent transactions could not have been completed and the money could not have been siphoned to White’s company without the explicit and active participation of the seven title agencies closed earlier this week. All seven of the title agencies are owned in part by Christy Jepson and/or by Patricia Jepson (his wife). The companies are: All American Title Agency, EJF Title Agency, Palatine Title Agency, Popular Title Agency, Senior Title Agency, Skyline Title Agency, LLC, and Title Zone.
IDFPR also charged that White failed to disclose to his customers that he maintained a financial interest in one of the seven interconnected title agencies shut down earlier this week, Title Zone. Elnora White, White’s grandmother, is a 30% owner of Title Zone, and All American owns the remaining 70% of Title Zone. White is the executor of Elnora White’s estate. Additionally, the Department found that White used these companies exclusively when closing mortgages relating to his ‘rescue’ transactions.
“Illinois consumers have the right to know that when they do business with companies licensed by our state, they will receive the best possible service by ethical and appropriately trained professionals,” said Dean Martinez, Secretary, Financial and Professional Regulation. “We will use all the tools available to us to discipline companies which violate the laws and regulations designed to protect Illinois homebuyers and help homeowners retain their properties.”
IDFPR recommends that homeowners in financial difficulty should first talk to their mortgage lender to explain the situation and to see if the loan can be restructured or refinanced. If the lender is not responsive, an owner should consider selling the house or engaging the services of a reputable real estate firm.
Regardless of the circumstances for selling or refinancing a home, it is extremely important that homeowners:
Read everything before signing and get all “promises” in writing. Verify all the figures at the closing for accuracy and completeness. Some schemers will offer to complete paperwork for the homeowner or ask that he or she sign a stack of documents, supposedly to secure a new mortgage. Victims later learn they signed a quit-claim deed to their home;
Be wary if a foreclosure “rescuer” or mortgage “broker” discourages the homeowner from contacting the mortgage company or an attorney;
Never sign a contract under pressure and never sign away ownership of property. Remember, signing over the property deed to someone else does not necessarily relieve the original owner of his or her obligation to repay the loan.
Ask a trusted family member, attorney or a financial professional to review paperwork before signing.
Failed Mortgage Firm Trustee Allowed $50,000 in Fees Union Leader
U.S. Bankruptcy Court Judge J. Michael Deasy will approve $50,000 in legal fees for the trustee of failed mortgage brokerage businesses Financial Resources Mortgage Inc. and CL&M Inc.
Bend Oregon Event to Help Homeowners Prevent Foreclosures Oregon.Gov
As part of an ongoing effort to help homeowners avoid foreclosure, state agencies are organizing a foreclosure-prevention event in Bend on Saturday, March 27, 2010.
Shelbyville Man Gets 2-Year Sentence For Loan Fraud Chattanoogan.Com
Prosecutor Gary Humble said the lost was approximately $2.3 million in the mortgage fraud involving hundreds of homes in the Shelbyville area.
Lend America, VP Ashley Banned from FHA Housing Wire
Michael Ashley, the embattled former vice president of Federal Housing Administration (FHA)-backed mortgage originator Lend America, and the company he worked for, were permanently banned from doing business in the industry last week.
Countrywide Tries to Pin Blame on Insurer Court House News
Countrywide Home Loans demands $111 million from Triad Guaranty Insurance, claiming Triad is trying to blame mortgage lenders for the insurer's role in the housing bubble and collapse.
Investors Say They Were Swindled in Property Scheme Fox 13 Now
Utah Division of Consumer Protection is joining forces with a few investors who claim they have been cheated by an agency called "Utah Mini Ranches.
Greenfield Man Accused of Housing Scam The Republic
A former real estate agent conned at least eight people by renting them properties actually owned by a federal agency and then running off with their deposits, prosecutors said.
Appraisal Institute Opposes Obama Administration's Plan for Homeowner 'Short Sales' PR News Wire
Citing concerns about increased mortgage fraud, four organizations representing more than 35,000 real estate appraisers today voiced their opposition to changes to an Obama administration program that will encourage "short sales" of homes.
Ownership Rights to Get Another Look TBO.Com
State lawmakers may beef up protections of property owners' rights by rewriting a law this spring that is at the center of a case of alleged fraud in Pasco County.
Thursday, February 18, 2010 F. Jeffrey Miller Trial Continued Testimony
As reported by Anne Mitchell, who viewed the trial:
Angela Parenza worked for Jeff Miller as the office manager for 7 or 8 years beginning in 1998. Parenza was indicted along with Miller and pled guilty to conspiracy to commit bank fraud and money laundering. Parenza testified that Miller or his contractors allegedly preferred to build all the...
Wednesday, February 10, 2010 F. Jeffrey Miller Trial Coverage Continued - Witness Testimony
Steve Middleton Testimony - Coverage Provided by Anne Mitchell
The Government continued in its cross examination of Steve Middleton. He was shown several HUD-1 statements involving sales of homes located in Overland Park, KS, and Olathe, KS. The HUD statements each allegedly showed line items of payments to (James) Moser & Associates, LLC's...
Monday, February 01, 2010 F. Jeffrey Miller Trial Coverage - Continued Witness Examination
According to Anne Mitchell, who is present in court for the trial:
Next Witness: Kelly Sanford
Kelly Sanford of the Federal Reserve was a short witness for the Government. Sanford manages electronic payments between banks and member financial institutions. He was shown copies of wire transfers and asked whether they coincided with the counts in...
Wednesday, January 27, 2010 F. Jeffrey Miller Trial - Prosecution Witnesses Continued
According to Anne Mitchell, who is viewing the trial:
January 13, 2010
Witness: Rick Hayes
Rick Hayes testified that on the day that he closed on his Miller Enterprise home, he received a phone call from the Kansas Banking Commission informing him that his loan was fraudulent. After the Hayes responded to a classified ad, they met with John...
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The information and notices contained on Mortgage Fraud Blog are intended to summarize recent developments in mortgage fraud cases and mortgage banking matters nationwide. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about mortgage banking, mortgage fraud matters or who believe they require legal counsel should seek the advice of an attorney. The creators, editors and sponsors of Mortgage Fraud Blog do not intend to create a confidential relationship or an attorney-client relationship by communication via or arising from this site.
Rachel Dollar, the editor of Mortgage Fraud Blog, is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors. She is an author and a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is a shareholder with the law firm of 
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