Alan David Tikal, 44, Brentwood, Contra Costa County, Calif., was arrested at his home on a complaint charging him with mail fraud for masterminding a multistate scam that defrauded distressed homeowners.
According to the complaint filed in federal court in Sacramento, Tikal has victimized more than 1,000 homeowners, who have paid in excess of $3.1 million. Of the identified victim homeowners, 95 percent are in California and approximately 185 reside within the Eastern District of California.
According to court documents, beginning in January 2010 and continuing to the present, Tikal operated a large-scale mortgage rescue scam. He convinced homeowners that he could satisfy their preexisting mortgage debt and replace it with a new debt to his company, KATN Trust. He claimed the new loan would only be for 25 percent of the original principal. Victims paid thousands of dollars in upfront fees and then made regular payments on their new loans. Tikal and his underlings instructed the victims not to pay their original mortgage and to ignore all correspondence from the original lenders. This resulted in many of the victims losing their homes to foreclosure.
Tikal is expected to make his initial appearance today before United States Magistrate Judge Edmund F. Brennan in Sacramento at 2:00 pm. If convicted, Tikal faces a sentence of up to 30 years in prison. The actual sentence, if convicted, will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.
The allegations in the complaint are mere accusations, and the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt in a court of law.
United States Attorney Benjamin B. Wagner and California Attorney General Kamala D. Harris announced the arrest.
“As the foreclosure crisis continues, we are seeing a rise in scams that target struggling homeowners,” said California Attorney General Harris. “These predators rob innocent families of their life savings and their piece of the American dream. I am thankful for the fine work of the California Mortgage Fraud Strike Force and of our U.S. Department of Justice colleagues in cracking this case.”
“The elaborate mortgage rescue scheme alleged in this case swindled more than 1,000 distressed homeowners in California and other jurisdictions out of more than $3.1 million,” said Christy Romero, Special Inspector General at SIGTARP. “As alleged, Tikal’s operation duped victims with false claims of drastically lowering their mortgage debt in exchange for advance fees. As a result of his alleged deceit, homeowners’ financial condition worsened, and for some, the opportunity to participate in legitimate loan modification programs such as the government-sponsored Home Affordable Modification Program (HAMP) was lost. SIGTARP will continue to work aggressively with our law enforcement partners to stamp out this type of abuse.”
“Prosecuting mortgage fraud is a top priority of this office, and we are increasingly focusing on those scams that victimize distressed homeowners,” said United States Attorney Wagner.
This case is a joint prosecution by the United States Attorney’s Office for the Eastern District of California and the California Attorney General’s Office. It is the product of an extensive investigation by the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), Internal Revenue Service – Criminal Investigation, the California Department of Justice, and the Stanislaus County District Attorney’s Office. Assistant United States Attorney Philip Ferrari and California Deputy Attorney General Maggy Krell are prosecuting the case.
