Archives For foreclosure fraud

Robert Jon Schlyer, 47, Portage, Indiana, a lawyer licensed to practice in Illinois, was convicted on federal fraud charges for scheming to provide falsified documents to prevent foreclosure on a nearly $2 million parcel of land in Aurora.  The fraud left an elderly couple out of $300,000.  The jury in federal court in Chicago convicted Schlyer of two counts of wire fraud affecting a financial institution, and one count of bank fraud.

Schlyer’s fraud scheme occurred while representing two clients, co-schemers Kevin Lebeau and Brian Bodie, in connection with a foreclosure lawsuit.  Evidence at trial revealed that Schlyer provided false and fraudulent documents to an elderly couple and Amcore Bank in order to postpone foreclosure on the Aurora property.

The jury returned the guilty verdicts on October 6, 2017, after a four-day trial.  U.S. District Judge Amy J. St. Eve set sentencing for January 31, 2018, at 9:15 a.m.  Each count carries a maximum sentence of 30 years in prison.

According to evidence at trial, in 2004 Amcore Bank received a mortgage on the 10.4-acre property in Aurora after issuing a $1.9 million loan for the refinancing and redevelopment of the property.  Lebeau and Bodie executed a full personal guarantee for the loan.  By the fall of 2005, Lebeau and Bodie had failed to make the required payments, the loan was in default, and the bank filed a foreclosure lawsuit to seize the property.

During the scheme, Schlyer, who acted as Lebeau’s and Bodie’s attorney in the foreclosure suit, obtained $300,000 from an elderly retired couple by providing them with fake documents that made it seem like they were making a safe investment in the redevelopment and that it would be secured by a trust.  Schlyer also claimed to be the trustee of the purported trust.  In reality, there was no trust and Schlyer was not a trustee.  Schlyer and his co-schemers also concealed from the elderly couple the foreclosure suit and LeBeau’s and Bodie’s inability to pay the bank debt.  A portion of funds obtained from the elderly couple through the fraud was used to pay down the bank loan.

Together with his co-schemers, Schlyer furnished fraudulent and fabricated documents to the bank, including forged documents that made it appear that investors had committed approximately $1.5 million to the redevelopment of the property.  Eventually the foreclosure occurred, and the property was sold in 2010 at a significant loss to the bank.

LeBeau, of Aurora, and Bodie, of Chicago, were previously convicted in the case and are awaiting sentencing before U.S. District Judge Robert W. Gettleman.

The conviction was announced by Joel R. Levin, Acting United States Attorney for the Northern District of Illinois; and John P. Selleck, Acting Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.The government is represented by Assistant U.S. Attorneys Kartik K. Raman and Amarjeet S. Bhachu.

Yun Soon Matsuba, aka Dorothy Matsuba, 65, Chatsworth, California; Thomas Matsuba, 64, Chatsworth, California; Jane Matsuba Garcia, 40, Chatsworth, California; and Jamie Matsuba, 31, Chatsworth, California, and Young Park, 53, Koreatown, California, were indicted for their alleged participation in a conspiracy to defraud banks and homeowners and were each charged with one count of conspiracy to commit wire fraud, make false statements and commit identity theft.  In addition, the 18-count indictment charges Dorothy Matsuba with five counts of wire fraud, five counts of making false statements and six counts of aggravated identity theft; Jane Matsuba Garcia with one count of wire fraud, two counts of making false statements and one count of aggravated identify theft; and Jamie Matsuba with one count of making a false statement.

Dorothy Matsuba is the alleged architect of a $30 million mortgage relief fraud scheme and the other four defendants are former employees of a purported mortgage relief company.

Dorothy Matsuba, Thomas Matsuba, Jane Matsuba Garcia and Jamie Matsuba were all arrested; Park remains a fugitive.  Thomas Matsuba is Dorothy Matsuba’s husband and Jane Matsuba Garcia and Jamie Matsuba are Dorothy Matsuba’s daughters.  Young Park is Dorothy Matsuba’s brother.

The indictment alleges that from 2005 to 2014, the defendants operated an interlocking web of companies, primarily under the names of Ownership Management Service LLC and Trust Holding Service LLC, which purported to help homeowners obtain relief from high mortgage debt through short sales, in which lenders agree to sell a mortgaged property for less than the amount owed on the mortgage.  In a scheme to defraud both the banks and the homeowners the defendants allegedly convinced homeowners to deed their property to trusts set up and controlled by the Matsubas and also promised to pay their mortgages while negotiating with banks to short sell those properties.  In the interim, the homeowners either remained in their properties or were relocated to another Matsuba-controlled property.  Instead of performing short sales as promised, Dorothy Matsuba and the other defendants failed to make mortgage payments and submitted false and fraudulent short sale purchase offers to the banks in an effort to delay foreclosure and maximize the time period over which the Matsubas could collect rent from the homeowners and other third parties placed in the properties by the Matsubas, the indictment alleges.  The Matsubas also routinely forged signatures, used false and stolen identities and filed fraudulent bankruptcy petitions—all in a scheme to delay foreclosure and maximize their profits at the expense of the homeowners and banks, the indictment alleges.

The scheme allegedly netted the defendants more than $30 million in rent during the conspiracy period.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Eileen M. Decker of the Central District of California, Assistant Director in Charge Deirdre Fike of the FBI’s Los Angeles Division, Acting Special Agent in Charge Charge Anthony J. Orlando of the Internal Revenue Service-Criminal Investigation (IRS-CI) Los Angeles Field Office, Special Agent in Charge Leslie P. DeMarco of the Federal Housing Finance Agency-Office of Inspector General’s (FHFA-OIG) Western Region and Sheriff Jim McDonnell of the Los Angeles County Sheriff’s Department made the announcement.

The FBI’s Los Angeles Division, IRS-CI’s Los Angeles Field Office, FHFA-OIG’s Western Region and the Los Angeles County Sheriff’s Department’s Real Estate Fraud Unit investigated the case.  Trial Attorney Niall O’Donnell and Senior Litigation Counsel David A. Bybee of the Criminal Division’s Fraud Section are prosecuting the case.  Senior Trial Attorney Nicholas Acker previously worked on the investigation.

Emily Suzanne Vasquez, 47, Inglewood, California, was sentenced in Nevada 12-48 months in prison after being convicted of one count of attempted theft, a category “C” felony. Vasquez was sentenced as a result of a local, state and federal investigation of a complex mortgage fraud scheme. Vasquez was also ordered to pay nearly $53,000 in restitution to her five victims.

Vasquez and other defendants operated a scheme to defraud five homeowners struggling to pay their mortgages and in danger of losing their homes. The victims were lead to believe that Vasquez’ alleged company, California Sky, would perform one or more services, including preventing the foreclosure of their homes, lowering their mortgage payments and refinancing their mortgages and reduce the payment and principal. Vasquez failed to perform any of these services, and all five of her victims lost their homes after paying Vasquez and California Sky more than $50,000.

The consequences for vulnerable homeowners who fall victim to scams like this one are devastating,” said Nevada Attorney General Adam Paul Laxalt . “My Office will continue to investigate and prosecute frauds like this one to deter future scams and ensure the safety of Nevada’s homeowners.”

This case was investigated by Investigator Jaclyn O’Malley, and was prosecuted by Senior Deputy Attorney General Eric Nickel.

 

Michael P. Barbour, a southern Alabama business man pled guilty for his role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in southern Alabama.  Barbour admitted to conspiring to fraudulently acquire title to foreclosed properties at artificially low prices by agreeing with others not to bid against each other at public foreclosure auctions in southern Alabama.

According to documents filed with the court, from 2003 until 2010, Barbour conspired with other potential bidders for foreclosed properties to designate one person to bid at certain public foreclosure auctions.  Once the designated bidder won the property at the public auction, the conspirators held a secret, second auction open only to members of the conspiracy where they paid each other off.  As a result of these crimes, homeowners and banks received less than competitive prices for the properties.  Continue Reading…