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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West Michigan Mortgage Fraud Scam Results in Charges
Damon Clark, Grand Rapids, Michigan and Reginald Tardy, Jr., Ferndale, Michigan are in custody after being charged with eight counts of perpetrating mortgage fraud in connection to six Grand Rapids, Michigan properties. Brian VanFarowe, formerly of Grand Rapids, Michigan, was also charged but has fled the country.
During 2005, it is alleged that mortgage loan officers Tardy and Clark and real estate investor VanFarowe conducted a mortgage foreclosure scam that targeted the Hispanic community in Grand Rapids. The targeted buyers often spoke or wrote little English and had a limited understanding of the mortgage process.
Promising them a piece of the American dream, Tardyand Clark prepared loan documents for the buyers with falsified financial information to ensure a mortgage could be obtained. The pair of loan officers acquired generous assessments for VanFarowe's properties and used the falsified loan applications to secure mortgages for the buyers which were higher than the actual property value.
At the closings, VanFarowe presented invoices alleging that legitimate services had been rendered by T.Dot Financial, a company owned by Tardy and Clark. These invoices were fraudulent because they were kick-backs to the loan officers for finding a buyer and getting the fraudulent loan application approved. Because VanFarowe did not object to the invoice, the mortgage company permitted payment from loan proceeds. As loan officers, Tardy and Clark had a duty under law to remain at "arms length" in arranging mortgage applications. They used the fraudulent invoices to hide the fact that they personally benefited from the inflated sale and fraudulent mortgage applications.
As a result of the scheme, the buyer ended up owning property with a mortgage greater than the actual value of the home, while Tardy, Clark and VanFarowe illegally walked away with thousands of dollars. The buyer, who's loan application was based on false income information, did not have the financial means to pay the mortgage and ended up in foreclosure.
Tardy, Clark, and VanFarowe are all charged with the following: * One count of racketeering, a 20 year felony. * One count of conspiracy to obtain a loan by false pretense, a 10 year felony. * Two counts of obtaining money by false pretense, more than $20,000, a 10 year felony. * Four counts of obtaining money by false pretense, less than $20,000, a five year felony.
Tardy and Clark were arraigned 64B District Court in Montcalm County.
Bond for each defendant was set at $250,000, cash or surety. A pre-exam conference is scheduled for Tuesday, August 25, 2009.
The Attorney General's office began investigating this scheme after receiving a referral from the Office of Financial and Insurance Regulation.
"Mortgage fraud hurts all of us through declining home values and a damaged financial system," said Cox. "But this case is especially disturbing because they targeted people who did not understand the process, creating a financial disaster while pocketing thousands for themselves."
"I would like to thank the Office of Financial and Insurance Regulation as we continue working together to tackle mortgage fraud in the State of Michigan," said Cox.
Attorney General Cox has made prosecuting mortgage fraud a priority for his office. In 2008, Cox created a mortgage fraud unit, teaming up with the Michigan State Police and other law enforcement agencies to tackle the problem. These defendants are the 21st person or company charged with a mortgage fraud-related offense by the Attorney General in the last 12 months. Cox's office has also held several mortgage foreclosure forums to help families stay in their homes during these difficult times.
A criminal charge is merely an accusation and the Defendant is presumed innocent unless proven guilty.
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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