Wednesday, November 15, 2006
Seven Indicted in Oklahoma Cash Back at Closing Scheme
Seven people were indicted in the U.S. District Court for the Western District of Oklahoma on allegations that they inflated the purchase price of homes to obtain cash back at closing in the guise of false remodeling or repair costs. Those indicted were:
Brandon L. Baum, real estate salesman and owner of Secorum Investments, LLC.
Gayle L. Caldwell, owner of Access Marketing Services Inc., Edmond, Oklahoma
Joseph Conrad Therrien, home buyer
Charles E. Caldwell Jr., husband of Gayle L. Caldwell and mortgage broker with United Lending, Oklahoma City, Oklahoma
Teresa M. Therrien, home buyer.
Rusty Real Therrien, home buyer and husband of Teresa Therrien.
Timothy J. McDaniel, home buyer.
(referenced by their initials in the indictment as home buyers but not charged were D.J.A. and F.B.)
According to the indictments:
Baum would tell his clients (potential home buyers that he represented as a real estate agent) that they could receive substantial funds at closing under the guise of repair costs that they would be able to use for their personal benefit so long as they agreed to purchase the homes at an inflated price. Seller’s agents that represented certain ‘hard to sell’ properties in the Oak Tree Subdivision, Edmond, Okalahoma, would negotiate with Baum.
Brokers at United Lending, including Charles E. Caldwell, Jr., would facilitate the submission of fraudulent loan applications for the potential homeowners that could not qualify for the loans. False information would be provided on the loan applications. In some cases, Baum, Charles Caldwell Jr., Joseph Therrien and Rusty Therrien would provide temporary loans to buyers for down payments with the understanding they would be reimbursed at closing from the purported remodeling or repair costs, marketing services fees and other undisclosed disbursements. The buyers in those cases would falsely represent the sources of the down payments.
Baum would present the sales contracts to the sellers agents at prices far above those listed on the MLS. The sellers agents would then present the contracts to the sellers by which the sellers would agree to ‘pay for’ the purported remodeling, repair and other charges. Once the purchase terms had been approved by buyer and seller, the seller’s agents would, in many case, increase the MLS list price to an amount equal to or above the agreed inflated purchase price to avoid detection by the lenders.
At closing, the title companies were directed by Baum, sellers’ agents and the sellers to issue checks from the sales proceeds to various entities for purported remodeling, repair costs, marketing service fees or other fees.
T.C.M. was an associate of Baum and controlled bank accounts that Baum used to funnel money back to defendants, buyers and others after closing. The title company checks issued to the various entities for purported remodeling, repairs and other fees would be deposited and Baum would direct T.C.M. to issue checks or obtain cashier’s checks payable to buyers, those who advanced down payment funds and others. In one case, Secorum was used to funnel these charges back to the buyer.
Properties referenced in the indictment:
1000 Irvine Drive, Edmond, Oklahoma
1709 Irvine Drive, Edmond, Oklahoma
5813 Dundee Terrace, Edmond, Oklahoma
5916 Morning Dove Lane, Edmond, Oklahoma
6125 Stonegate, Edmond, Oklahoma
1208 Troone Drive, Edmond, Oklahoma
mortgage fraud
Thanks for posting this. I understand that the FBI was working on this for about 2 years. What amazes me is that there were about 13 homes in Oak Tree total that were part of the same scam and there were many others not included in this legal action. I hope that the others will pay for thier actions as well. This has got to stop!
Posted by
Russell Benson on 11/15 at 05:37 AM
Brandon Baum tried to buy my Oak Tree home in this fraudulent way, but in my case he was himself, the buyer. I guess he was running out of associates and decided to work alone on my house. I believe the appraiser he used was also involved.
Posted by on 11/30 at 09:42 AM
Diane:
Thank GOD you did not go through with the deal. There are about 13 homes total and I don’t have the latest numbers, but I think at least half have been or are in foreclosure. As a Oak Tree homeownner, has the issue ever been raised about the higher taxes the owners are paying as a result of the inflated sales prices? I think the owners have a strong case to insist the Assessor re-evaluate the property taxes.
Posted by
Russell Benson on 12/02 at 06:45 PM
Its really sad and surprising that Brandon Baum has literally become the patsy of this entire fraud case. There were so many other “names” involved in this (especially Ann Campbell, a well known Oak Tree realtor) that were not mentioned and it was made to look as thought Mr Baum was the one and only ringleader.
What about those that were not mentioned? It’s a shame that THEY are not getting fingers pointed at them as well and that Mr Baum if getting the brunt of it.
I’d wager that more names shall come out as this proceeds. I would hope so—
Posted by on 12/06 at 09:48 AM
Well, the name Ann Campbell is no longer a silent one as both Fox 25 and News9 have had reports with her in it and Fox even showed her picture and Remax sign. She pleas on December 13th so look for more info to come!
Posted by on 12/07 at 05:57 AM
why is the real estate agent responsible if someone comes to them and wants to pay more than the listed price? Since when is an agent supposed to say, “No! We don’t want your money?”
Posted by on 12/19 at 11:57 AM
I believe she went beyond a realtor function. By placing funds into her account for “repairs”, and using it for down payment money, that went beyond “paying more than the asking price of the property”.
Posted by on 01/24 at 11:27 AM
Thank you all for this article. I live in Omaha, and we have an individual come into our neighborhood and now is up to 10 Cash Back deals all on the same block that are destroying our neighborhood. This person had done this same scam in Kansas, then in Lee Summitt CO before moving to Omaha. If anyone has any advice, please let me know. Thanks, Rich
Posted by on 02/23 at 01:37 PM
I’ve been reading about this scam and have a question.
Have any of the sellers who owned the properties been procecuted?
Posted by on 03/02 at 08:23 AM
None of the owners have been charged other than the stray buyers who in turn were also owners at some stage of the scam. But the real actual owners who had their homes up for sale when the fraud happened have not been charged, to the best of my knowledge. The real question would be how much did they know about what was going on and what did they think was the reason sales prices were being raised by thens of thousands of dollars.
Posted by on 03/03 at 06:08 PM
Rich:
You would need to be able to prove the cash back as this is illegal, especially if it is not on the HUD-1. The money is usually disguised as repairs or home improvement or even as mortgage broker fees and then that money, at least part of it is funneled back in part to the buyer.
Posted by on 03/03 at 06:11 PM
brandon is the ring leader of this whole scheme brandon was the only realator that can sell you a house you could not afford or you could not go out and get your own financing on. He tried to sell me a house in dear creek. I told him that i would not be able to make the payments. It was like 250000 when i was looking for something under 100000. He told me that financing was very easy. he told me dont worry about it he also said me that i would not have to make a payment for 1 year and i would get some cash back at closing. Wow a perfect deal???? you have to be pretty stupid to think you can buy a house this way. I am not a investor I need a home to live in. I know the therien’s they are being treated a little unfair. they were the only ones that were still living in there over priced home when they got indicted. But the way they were all doing these deals were pretty stupid. in only took one person to try to refinace the home to find out the have been part of a scam. But everyone gets caught. it is only a matter of time.
Posted by on 03/22 at 08:08 PM
THE THERRIENS HAD LET THEIR HOMES GO BACK A YEAR BEFORE THIS HAPPENED. I GREW UP WITH ALL THE THERRIENS. ALTHOUGH THEY WERE BEING LIED TO BY BRANDON BAUM AND WERE TOLD AS LONG AS EVERYTHING WAS ON THE HUD IT WAS LEGAL. THEY COULDNT AFFORD THE HOME AND LET IT GO BACK...BRANDON IS THE 1 WHO APPROACHED THE SELLERS AND WORKED CLOSELY WITH ANN CAMPBELL, ANTHONY JEW WITH UNITED LENDING, TONY MICHAELS WAS THE FAKE CONSTRUCTION COMPANY, PHIL ODOM WAS THE BROKER WHERE BRANDON WORKED AND WAS ALLOWED SUCH SCHEMES. THE THERRIENS JUST GOT CAUGHT UP IN A BAD SITUATION!! THERE IS A SLEW OF PEOPLE WHO PLEAD GUILTY AND TURNED STATES EVIDENCE THAT ARE NOT IN THE BRUNT OF THIS DEAL THAT SHOULD BE!
Posted by on 03/26 at 12:01 PM
I’m trying to understand the legal points here, so if anyone can help, I would appreciate it. I understand that:
a) The seller sold a house to a buyer at a price that was greater than the MLS.
b) In return, the seller provided to the buyer a remodeling fee after the sale was completed
c) The realtor facilitated the sale by arranging for 3rd parties to provide the downpayment.
Is this correct? Are the parts that are illegal that a) the seller inflated the price of the house to create a margin that was then returned to the buyer? (would it have been any different if the price was held at the MLS, but then the seller still provided a remodeling fund...essentially selling at a discount?) b) that the downpayment was covered by someone else on behalf of the buyer? c) that the returned money wasn’t completely used for remodeling? d) that the realtor acted as more than a realtor? Thanks for your help in explaining the legalities.
Posted by on 03/26 at 05:59 PM
Jim:
In short, what happened was the deals were cooked up, homes were found that were already for sale and the prices were raised to make it appear that the home had that list price rather than the original, lower list price. This would have been for the benefit of the company that was actually funding (loaning) the deal. That way it looked legit when it wasn’t. Some of the homes had already been remodeled or were in updated condition, thus the funds they say were for construction was not and that money was funneled back into “their” pockets and used for other transactions (down payments, etc). The old saying it takes two to tango would apply here except it took a whole lot more than that. The trial is going on now as we speak. If you get a chance, read the indictments, They are quite interesting.
Posted by on 03/27 at 05:44 PM
Chuck Caldwell had no idea of what was going on. Brandon was forging Chuck’s signature on all of the forms.
Posted by on 08/17 at 08:35 AM
Anyone dealing with Brandon Baum is going to be guilty by Association, at the least. This guy was bad news and those doing buisness with him knew this and should have stayed far away. If Baum was forging signatures, that should have come out in the trial and it didn’t. I’m looking forward to hearing what Baum’s sentance is. Don’t drop the soap!
Posted by on 08/24 at 07:40 AM
Hello,
I had a man approach me today and offer to buy our house for $25k over the current MLS listing in this manner...I would have to pull off the MLS currently and list with his partner at $25k more, and then we would close on the house, he would pay his partner the sales commission, and I would in turn get the full original asking price. Obviously this is some sort of scheme so that he can get more cash up front on the deal. He says it is so that he can “protect his property value”. What is he really trying to accomplish?? The man is a licensed realtor and has an approval letter, an appraiser, and a closing attorney all on his side. It smells fishy to me.
Posted by on 02/03 at 06:54 PM
There are so many things wrong with this. If he has a real estate license, he is in multiple violations of the code of ethics for approaching you with the proposed deal. If this is a mortgage scam, it must be listed in the MLS at the desired price. They used to raise the price in the MLS but everyone is on to that so the only way to do it is to put in a new listing in the MLS. I can put you in touch with the local FBI man if you want. He might want to know about your person.
Posted by on 02/06 at 02:36 PM
How do these people sleep at night? I’m glad that these real estate people are getting convicted of these crimes. The crimes hurt everyone.
Posted by
real estate postcards on 11/10 at 11:02 PM
Post a Comment
The trackback URL for this entry is:
Trackbacks:
|
Some Sources require Registration.
Mortgage Fraud Risk Index Jumps 11 Percent, According to Verisk Analytics Subsidiary Interthinx
CNNMoney.com
The report...indicates that the overall Interthinx Mortgage Fraud Risk Index surged more than 11 percent from the previous quarter...
Mortgage Fraud Case Appears Headed to Jury in Jackson County Circuit Court
The Jackson Citizen Patriot - MLive.com
The prosecution and defense rested Thursday in the mortgage fraud cases against Teresa Marie WIlson and Angelo Surveo Williams.
Wyoming Woman Charged with Mortgage Fraud After Allegedly Stealing Sister's Identity
MLive.com
A Wyoming woman is facing felony charges accusing her of stealing her sister's identity to obtain a mortgage...then defaulting on that mortgage, leaving taxpayers on the hook.
U.S. Attorney Targets White-Collar Crime
Wall Street Journal
In San Francisco, Mr. Russoniello said he is trying to crack down on cases like mortgage fraud, though he doesn't have the budget to hire additional white-collar prosecutors.
Arrests Made in Orlando Mortgage Fraud Roundup
MyFoxOrlando.com
During the real estate boom two years ago, some units were going for a half million dollars. Now some are short selling for just 50 grand.
10 Accused of Mortgage Fraud at PR Coastal Resort
Forbes
A developer and nine other people, including a former salsa singer, have been charged in an alleged $14 million mortgage fraud in Puerto Rico...
Strodtman Jury Selected in Mortgage Fraud Trial
Greeley Tribune
Attorneys will deliver opening statements this morning in the trial of Mark Strodtman, who is accused of bilking homeowners in a mortgage scheme years ago.
FHA Digging Out After Loans Sour
Wall Street Journal
Most banks rejected Ms. DeForte because her debt level was too high and her credit score too low. But Lend America put Ms. DeForte into a $402,000 loan backed by the Federal Housing Administration...
Mortgage Fraud Probe Nets 105 Across State
Bradenton Herald
At least one local man is among 105 people arrested across the state following a nine-month investigation into organized mortgage fraud.
Mortgage Fraud Increases
MortgageRates.co.nz
The number of frauds involving professional advisors, such as accountants and lawyers, has increased from two to four since March 2008.
Previous Articles
|
Trial coverage provided by Anne Mitchell, Crazy Fish Realty.
F. Jeffrey Miller Update - October 20, 2009
A hearing was held in Topeka, Kansas in front of Judge Julie Robinson. Miller is currently being held pending his sentencing which is set for December 22nd, 2009 at 9:00 a.m.. Steve Vanatta and Hallie Irvin, Miller's codefendants, will be sentenced at that time also.
Several motions were heard this week. One was a motion for Miller to be released pending his sentencing. Miller's attorney, Jeff Morris, argued that the court had dismmissed with predjudice the matter involving Miller's purchase of a commercial lawnmower, violating the court ordered monitoring agreement. He also argued that Miller was not a flight risk and should be released. This motion was denied.
Another motion heard by Judge Robinson was that of an escrow account containing proceeds from the sale of Miller's forfeited assets. This account has a balance of $143,000. Attorney Morris argued that his firm was due $100,000 for work done in the Miller matter, to date. The government argued that his 'un-itemized fees' were 'exhorbitant'. The balance of the funds, Morris argued, should be released to the Miller family to help pay for mounting household expenses.
The government argued that the 'Asset Forfeiture Provision' applies down to 'the last penny' and that 'the rights of the victims to made whole are of paramount immportance' and that no routine household expenses like Visa bills, are allowed.
Attorney Morris argues that there is more than enough assets to satisfy the jury's judgement of $2.65 million dollars. The government argues that the estimated value of his assets are only $1.4 million.
The government also stated that Miller has been paid dividends from a company Miller has an ownership interest in; Boreflex. From July, 2008 to present, Miller has been paid $330,509.30 from Boreflex, unbeknownst to the court appointed monitor.
Present in the courtroom was Todd Earnshaw. Earnshaw was indicted along with Miller and others in what is commonly referred to as 'Miller I'. That trial is scheduled to begin on January 11, 2010 in Topeka, Kansas.
More Trial Coverage
|
|
|
|
|
|
|
|
|
|
|
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 
