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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Pennsylvania Man Pleads Guilty To Foreclosure Bailout Scheme
Terence Mayfield, 47, Phoenixille, PA, pleaded guilty before U.S. District Judge Joseph H. Rodriguez to one count each of mail and wire fraud for his role in operating two ponzi schemes upon members of a Toms River church which resulted in total losses of more than $1 million. Judge Rodriguez released the defendant on a $100,000 bond pending sentencing, which is scheduled for July 14.
The Information charges Mayfield operated two frauds from November 2006 through July 2008. In Count One, Mayfield is charged with mail fraud in connection with his scheme to defraud numerous members of The Church of Grace and Peace of more than $1 million through a phony real estate investment scheme. Count Two charges Mayfield with wire fraud relating to his scheme to defraud three sets of homeowners, who participated in three "foreclosure bailouts" purportedly involving two properties in Georgia and one in Pennsylvania, of more than $75,000.
At his plea hearing, Mayfield stated that in November 2006 he spoke to church members about an investment opportunity he had developed through his company "4 Life, LLC," with offices in Phoenixville. According to Mayfield, the "My Home Banc" ("MHB") program would help investors eliminate debt and build wealth through investments in income-generating real estate. Mayfield also suggested investing in distressed real estate, or what he referred to as "foreclosure bailouts."
Soon after he first spoke to congregants, Mayfield began soliciting money from church members and holding meetings at the church and elsewhere, he admitted. During these meetings, the defendant portrayed himself as a legitimate investment advisor and required each potential investor to pay between approximately $1,000 and $1,500 as an "entry fee" to the MHB program.
After paying the fee, potential investors met with Mayfield regarding the investment program, at which time Mayfield told the potential investors that he would identify and provide them with information about available income-generating properties which would generate positive cash flow for the potential investor, he admitted. Mayfield admitted that he told his victims that they had to provide the investment funds directly to him and that after he received the funds he would begin working to identify a suitable investment property for the investor. Furthermore, Mayfield stated that once he identified a suitable investment property, he would work on behalf of the investor to facilitate the purchase of the property. Furthermore, in some instances when potential investors did not have the cash required, Mayfield advised them to refinance their homes, he admitted.
Mayfield admitted that he did not maintain the funds in escrow accounts as he told investors would be the case. Mayfield also admitted that aside from helping two investors identify and arrange for the purchase of an investment property in Charlotte, N.C., he never purchased or arranged for the purchase of investment properties for investors from the church as part of the mail fraud. Mayfield used the investors' funds to repay earlier investors and to pay his personal expenses, he admitted.
In regards the second scheme, Mayfield admitted that beginning in May 2007 he solicited potential investors to invest in the program he referred to as "foreclosure bailouts." To induce these individuals to invest in this program, Mayfield explained that the investor would buy the home of a homeowner who was at risk of foreclosure and then lease the home back to the homeowner for a two-year period. The homeowner would then use a portion of the proceeds to pay the investor an "investment fee" and Mayfield a "broker's fee." Additionally, the homeowner would place two years' worth of rent payments into an escrow account, which would be maintained by Mayfield, as a security deposit. At the end of the two-year period, Mayfield explained, the homeowner would have the opportunity to repurchase the home from the investor.
Mayfield, as part of the scheme and to induce a homeowner to participate in a "foreclosure bailout," made substantially the same representations to homeowners with a significant exception: That the escrow account funds would not serve as security for the investor, but rather would be "drawn down" on a monthly basis and used to pay the homeowner's monthly rent payments. Mayfield admitted that at the closing of the "foreclosure bailout" transactions, he directed the homeowner to either wire transfer or directly deposit funds intended to be maintained in an escrow account into his company's bank account. Mayfield admitted he did not maintain the funds in escrow, but instead used the funds for his own benefit.
Each charge of mail and wire fraud carries a maximum penalty of 20 years in prison and a fine of $250,000 or twice the aggregate loss to the victims or gain to the defendants.
In determining an actual sentence, Judge Rodriguez will consult the advisory U.S. Sentencing Guidelines, which provide appropriate sentencing ranges that take into account the severity and characteristics of the offense, the defendant's criminal history, if any, and other factors. The judge, however, is not bound by those guidelines in determining a sentence. Parole has been abolished in the federal system. Defendants who are given custodial terms must serve nearly all that time.
Acting U.S. Attorney Ralph J. Marra, Jr. made the announcement. Marra credited Postal Inspectors with the U.S. Postal Inspection Service, under the direction of Inspector in Charge David L. Collins, and Special Agents of the FBI's Trenton Resident Agency, under the direction of Special Agent in Charge Weysan Dun, with the investigation leading to the guilty plea.
The government is represented by Assistant U.S. Attorney Matthew T. Smith of the Criminal Division in Camden.
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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