Archives For Texas

Lake Jackson Area Attorney Convicted for Bank Fraud

Stephanie Abbott —  April 30, 2018 — Leave a comment

Kirk Lawrence Brannan, 64, Texas has entered a guilty plea to bank fraud for his role in a mortgage fraud scheme.  Brannan admitted to conspiring with others from 2005 to 2009 to execute a scheme to defraud Wells Fargo Bank and other lenders.

Brannan sold 10 beach homes in the Freeport/Surfside, Texas area to “straw buyers” at exorbitant prices. Other co-conspirators recruited straw buyers who created loan applications with misrepresentations that lenders relied upon in deciding to make the mortgage loans. The applications contained misrepresentations of the buyer’s address, employer, income and expenses. The applications also suggested the buyers were much better credit risks than they actually were. Brannan admitted he paid kickbacks to co-conspirators each time one of the beach homes was sold to a straw buyer.

The beach properties were sold at two to three times the appraised values. The mortgage lenders, including Wells Fargo Bank, were induced to lend the inflated amounts for the purchases through flawed or fraudulent appraisals which were based on comparisons Brannan manufactured to further the scheme.

Brannan created settlement statements that suggested he sold three of his properties to his children at exorbitant prices. Appraisers relied upon these “sales” as comparable sales in appraising Brannan’s remaining properties sold to straw buyers. As a result of the fraudulent appraisals, he and his co-conspirators were able to inflate the values for his properties and deceive the lenders into approving home loans at those exorbitant amounts.

All of the straw buyers defaulted on the mortgages, and all 10 of the beach properties ended up in foreclosure.

The fraudulent mortgage loan scheme resulted in a loss of $5,317,350 to Wells Fargo Bank and the other lenders. Brannan paid $2,401,368 to his co-conspirators as part of the scheme.

U.S. District Judge Lee Rosenthal accepted the plea and set sentencing for Aug. 29, 2018, at which time Brannan faces up to 30 years in federal prison and a possible $1 million maximum fine. He was permitted to remain on bond pending that hearing.

Co-conspirators Chucoboie Lanier, 41, Houston, Texas, David Lee Morris, 55, Houston, Texas, and Derwin Jerome Blackshear, 50, Houston, Texas, previously pleaded guilty for their roles in the scheme. They are set for sentencing Sept. 26, 2018.

U.S. Attorney Ryan K. Patrick made the announcement.

The Texas Department of Public Safety and the FBI conducted the investigation. Assistant U.S. Attorneys Robert Johnson and Michael Day are prosecuting the case.

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Man Pleads Guilty in “Foreclosure Rescue Scheme”

Stephanie Abbott —  April 4, 2018 — Leave a comment

Mark Demetri Stein, 38, Carrollton, Texas, appeared in federal court this morning and pleaded guilty to one count of mail fraud.

A federal grand jury in Dallas returned an indictment in December 2016 charging Stein and three others with felony offenses stemming from a “foreclosure rescue scheme” they ran from approximately February 2012 through January 2013. http://www.mortgagefraudblog.com/?s=Mark+Demetri+Stein  Bruce Kevin Hawkins, 52, Desoto, Texas, Richard Bruce Stevens, 51, San Antonio, Texas, and Christina Renee Caveny, 37, Dallas, Texas have pleaded guilty to their roles in the scheme. Hawkins and Caveny have been sentenced to 41 months and 15 months in federal prison, respectively. Stevens is scheduled to be sentenced before U.S. District Judge David C. Godbey on May 7, 2018.

According to documents filed in the case, Stein operated Real Estate Solutions, Stevens used Texas Real Estate Services, and Hawkins formed ERealty Mortgage Group, LLC, as foreclosure rescue companies.  The conspirators used third parties to contact homeowners and offer them an opportunity to get out of their present home loans and receive a new home loan with a reduced interest payment and reduced monthly payment.  Hawkins and other conspirators falsely represented to homeowners that they had “investors” standing by who were ready to quickly purchase the homeowner’s present loan from the lender holding the current mortgage.  They also falsely represented that they would use investors to purchase the homeowner’s loan from the original lender at a greatly reduced price through a “short sale” process.

Furthermore, Hawkins and other conspirators falsely represented to the homeowners that the homeowners had the legal authority to transfer their homeowner’s deed to the defendants.

As part of the scheme, the conspirators fraudulently required homeowners to start making all future loan payments to them based on fraudulent so-called “loans,” and they also told homeowners to ignore late payment notices sent by lenders.  As part of the scheme, the conspirators conducted a fraudulent “closing” for each homeowner where they caused the homeowner to pay them a large down payment on the new “loan,” and they also had the homeowner sign fraudulent documents, such as a promissory note, deed of trust, special warranty deed, and/or a so-called “land trust.”

Further, according to plea documents, the conspirators falsely represented to homeowners that the conspirators could “sell” their property back to the homeowner with a new loan, when the conspirators well knew they did not legally own the property.  The conspirators also told homeowners to ignore notices of nonpayment from their present lender as they continued to unlawfully collect monthly so called “mortgage payments” from homeowners.  In fact, conspirators instructed several homeowners to file for bankruptcy but to not follow up with the bankruptcy process as an additional means to delay foreclosure and conceal the conspirators’ criminal conduct.  Conspirators concealed that all down payment and monthly mortgage payments fraudulently collected from homeowners was spent for their own personal benefit.

The defendants recruited at least 70 distressed and vulnerable homeowners who were facing the imminent threat of foreclosure on their homes and fraudulently collected a total of at least $242,000 from them.

Stein faces a maximum statutory penalty of twenty years in federal prison and a $250,000 fine.  Restitution could also be ordered.  Stein will remain on bond pending sentencing which will be set at a later date.

U.S. Attorney Erin Nealy Cox of the Northern District of Texas made the announcement.

This case is one of many felony indictments of bankruptcy-related crimes prosecuted as part of the Bankruptcy Fraud Initiative, United States Attorney’s Office, Northern District of Texas.  These bankruptcy prosecutions were a part of a larger number of criminal referrals regularly made to this office by the United States Trustee’s Office, Dallas, Texas.  Since 2013, these focused prosecutions have resulted in 25 convictions of individuals engaged in various types of fraudulent conduct within the United States Bankruptcy Courts.

The Dallas FBI investigated the case.  Assistant U.S. Attorney David Jarvis is in charge of the prosecution.

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Mortgage Fraudster Gets More Prison Time

Stephanie Abbott —  March 12, 2018 — Leave a comment

Oscar Cantalicio Ortiz, 54, Kingwood, Texas has received a second federal sentence for failing to appear in court. Today, U.S. District Judge Kenneth Hoyt handed Ortiz another 12 months and one day to be served consecutively to the already-imposed 262 months for his conviction of bank fraud.

Ortiz was originally convicted for a mortgage fraud scheme in which he admitted he conspired to commit bank, mail and wire fraud. He was permitted to remain on bond pending his sentencing in that case, but was ordered to wear a GPS monitoring device secured around his leg as a condition of his release.

On April 21, 2017, he cut off the device and left it on the side of the road in southwest Houston, Texas. His vehicle was later found abandoned in a parking lot in the same area of town.

On April 24, 2017, Ortiz was set to appear before U.S. District Judge Kenneth M. Hoyt for sentencing in the mortgage fraud scheme. He failed show for that hearing.

He was residing in Mexico and turned himself in to the U.S. Embassy in Mexico City, Mexico on August 23, 2017. Ortiz told the FBI at the Embassy that he was a fugitive from the United States and had decided to flee because he wanted more time to work on a project. He was flown back to Houston the following day.

Ortiz pleaded guilty December 4, 2017.

Upon his arrival, agents noted that Ortiz had changed his appearance by growing facial hair and dying it and his hair red. Ortiz admitted he had purchased a second car to replace the one he abandoned and drove across the border into Mexico where he stayed until his arrest.

While a fugitive, Judge Hoyt imposed the nearly 22-year sentence in absentia which will be served consecutively to the term imposed today. http://www.mortgagefraudblog.com/?s=Oscar+Cantalicio+Ortiz

The announcement was made by U.S. Attorney Ryan K. Patrick.

The FBI conducted the investigation of both cases. Assistant U.S. Attorney Melissa Annis is prosecuting the cases.

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Three Sentenced in Second Chance Lending Scheme

Stephanie Abbott —  December 14, 2017 — Leave a comment

Luis Antonio Rodriguez, 37, Mission, Texas, Rogelio Ramos Jr., 37, Pharr, Texas have been ordered to prison today for conspiracy to commit wire fraud following their convictions related to a “second chance” mortgage lending scheme. Also sentenced today was another co-conspirator, Guadalupe Artemio Gomez, 32, Mission, Texas, who had pleaded guilty prior to trial.

All three were accused of operating a “second chance” financing business under the names of T.G. and Wealth, Infinite Properties and Me In 3D, focusing on individuals who were financially unable to apply for traditional home financing. The investigation revealed Gomez, Rodriguez and Ramos conducted business in McAllen, Mission, Edinburg, Houston and San Antonio, Texas by hiring recruiters to funnel prospective home buyers to Infinite Properties. The homebuyers then gave 10 percent of the purchase price as a down payment to Infinite Properties. http://www.mortgagefraudblog.com/?s=Luis+Antonio+Rodriguez

During trial, the jury heard from victims, law enforcement and an FBI forensic accountant who testified that instead of using the down payments as intended, the money was used for personal expenses, trips to Las Vegas, Nevada and to purchase other real estate.

At the hearing, the court heard from all three defendants as well as numerous victims who provided testimony that described the substantial harm they and their families suffered as a result of the fraud.

Gomez testified at trial against Rodriguez and Ramos stating the two men received more than $1 million in the mortgage scheme in 2016.

The defense claimed they had no intent to defraud the victims because they had attempted to get a $10 million loan. The jury was not convinced and found both men guilty as charged.

U.S. District Judge Randy Crane ordered Rodriguez to serve a total of 13 years in federal prison, while Ramos received a 90-month term of imprisonment. Gomez received a four-year sentence. The three men were further ordered to serve five years of supervised release and ordered to pay $1,858, 997.75 in restitution to the victims of the scheme.

Previously released on bond, the three men were taken into custody following the sentencing today where they will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

Acting U.S. Attorney Abe Martinez made the announcement.

The FBI, Texas Department of Insurance and police departments in McAllen, Mission and Edinburg conducted the investigation.

Assistant U.S. Attorneys Robert L. Guerra Jr. and Andrew Swartz prosecuted the case.

 

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Rescue Fraudster Sentenced in Texas

Rachel Dollar —  October 2, 2017 — Leave a comment

Bruce Kevin Hawkins, 52, Desoto, Texas, was sentenced to serve 41 months in prison and pay $219,109 in restitution for his role in a foreclosure rescue scheme that exploited vulnerable homeowners facing foreclosure.

Hawkins pleaded guilty in June 2017 to one count of mail fraud.  He has been in custody since the time of his arrest in January 2017.

A federal grand jury in Dallas returned an indictment in December 2016 charging Hawkins and three others with felony offenses stemming from a “foreclosure rescue scheme” they ran from approximately February 2012 through January 2013.  Richard Bruce Stevens, 51, San Antonio, Texas, and Christina Renee Caveny, 37, Dallas, Texas, also pleaded guilty and will be sentenced later this year.  Mark Demetri Stein, 36, Carrollton, Texas, is awaiting trial.

According to documents filed in the case, Stein operated Real Estate Solutions, Stevens used Texas Real Estate Services, and Hawkins formed ERealty Mortgage Group, LLC, as foreclosure rescue companies.  The conspirators used third parties to contact homeowners and offer them an opportunity to get out of their present home loans and receive a new home loan with a reduced interest payment and reduced monthly payment.  Hawkins and other conspirators falsely represented to homeowners that they had “investors” standing by who were ready to quickly purchase the homeowner’s present loan from the lender holding the current mortgage.  They also falsely represented that they would use investors to purchase the homeowner’s loan from the original lender at a greatly reduced price through a “short sale” process.

Furthermore, Hawkins and other conspirators falsely represented to the homeowners that the homeowners had the legal authority to transfer their homeowner’s deed to the defendants.

As part of the scheme, the conspirators fraudulently required homeowners to start making all future loan payments to them based on fraudulent so-called “loans,” and they also told homeowners to ignore late payment notices sent by lenders.  As part of the scheme, the conspirators conducted a fraudulent “closing” for each homeowner where they caused the homeowner to pay them a large down payment on the new “loan,” and they also had the homeowner sign fraudulent documents, such as a promissory note, deed of trust, special warranty deed, and/or a so-called “land trust.”

Further, according to plea documents, the conspirators falsely represented to homeowners that the conspirators could “sell” their property back to the homeowner with a new loan, when the conspirators well knew they did not legally own the property.  The conspirators also told homeowners to ignore notices of nonpayment from their present lender as they continued to unlawfully collect monthly so called “mortgage payments” from homeowners.  In fact, conspirators instructed several homeowners to file for bankruptcy but to not follow up with the bankruptcy process as an additional means to delay foreclosure and conceal the conspirators’ criminal conduct.  Conspirators concealed that all down payment and monthly mortgage payments fraudulently collected from homeowners was spent for their own personal benefit.

The defendants recruited at least 70 distressed and vulnerable homeowners who were facing the imminent threat of foreclosure on their homes and fraudulently collected a total of at least $242,000 from them.

Hawkins was sentenced before U.S. District Judge David C. Godbey and the sentence was announced by U.S. Attorney John Parker of the Northern District of Texas

The Dallas FBI investigated the case.  Assistant U.S. Attorney David Jarvis prosecuted.

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Dallas County Community Action Committee Vice-President Pleads Guilty to Defrauding Homeowners

Rachel Dollar —  October 2, 2017 — Leave a comment

Francisco Javier Gonzalez, a/k/a “Javier Gonzalez,” 45, Duncanville, Texas, vice-president of Dallas County Community Action Committee, Inc., pleaded guilty to one count of mail fraud

According to documents filed in the case, the DCCAC was a non-profit entity, accredited by HUD between October 1990 and mid- February 2016, to provide housing counseling. It was created in 1965 by the Dallas Commissioners Court to support the efforts of the Johnson administration to combat poverty. Gonzalez served as DCCAC’s Vice President and one of the directors. Gonzalez also leased space in the DCCAC offices for another entity, known as Residential Counseling FJ LLC.

According to the charging documents filed in the case, between 2009 through 2016 Gonzalez through his work at DCCAC, defrauded homeowners under the guise that he was assisting them with mortgage assistance. Gonzalez specifically sought out victims who were facing financial difficulty and who had contacted the DCCAC seeking mortgage loan and foreclosure prevention assistance. He also identified victims facing such financial distress by subscribing to the Foreclosure Listing Service, a/k/a Roddy List, which offers listings of foreclosure and pre-foreclosure homes, by county, through a review of public records. Once identified, Gonzalez would meet with these victims in the DCCAC offices and in the victims’ homes. He would explain a plan to reduce the victim’s mortgage payment and to prevent foreclosure; the plan often included a loan modification application. These applications often contained information that had been falsified by Gonzalez and were otherwise incomplete.

According to plea documents, on February 28, 2013, Gonzalez prepared and submitted a false and fraudulent Real Estate Settlement Procedures Act (RESPA) application to a bank in an effort to delay foreclosure and extract additional funds from victims. As a result of Gonzalez’s scheme to defraud homeowners, the Department of Housing and Urban Development and certain banks suffered a loss of $611,740.55.

Gonzalez faces a maximum statutory penalty of 20 years and a $250,000 fine. Restitution could also be ordered. He has been in custody since the time of his arrest in October 2016.

U.S. Attorney John Parker of the Northern District of Texas announced the plea. HUD Office of Inspector General, FHFA Office of Inspector General, and the USPIS investigated the case. Assistant U.S. Attorney P.J. Meitl is in charge of the prosecution.

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Charges in Operation Surreal Estate

Rachel Dollar —  October 8, 2015 — 1 Comment

The Cameron County, Texas District Attorney’s Office dismantled a county-wide real estate scheme that defrauded its victims out of more than $400,000 from 2013 through 2015.  Dubbed “Operation Surreal Estate”, the investigation began in July 2015 when victims contacted the District Attorney’s Office for help.

The several-month-long investigation uncovered a crime ring, led by Allan Ramirez Rodriguez, 27, Brownsville, Texas, who convinced real estate buyers to invest in and/or purchase properties. False deeds were provided to the investors for properties Rodriguez and his accomplices never owned. Organizers of the scheme even attended public real estate auctions to provide an appearance of legitimacy.  Rodriguez was charged with three counts of theft of property, three counts of engaging in organized criminal activity and securing execution of a document by deception.  Rodriguez has not been taken into custody.

In addition to Rodriguez, those involved in the organized criminal activity were: Continue Reading…

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“You can have whole neighborhoods that are economic wipeouts. Who did it really help? The builder. He got his sale.”

Richard Hagar, national expert on mortgage fraud, explaining the effect of builder bailouts to The Dallas Morning News

 Posted by Rachel Dollar  onJuly 14, 2015 In Mortgage Fraud on the web ,
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Former Bank President Admits Overestimating Assets

Allison Tussey —  June 10, 2015 — Leave a comment

Laurie Mayfield, aka Laurie H. Scott, 54, Fredericksburg, Texas, former D’Hanis State Bank president, admitted that she filed fraudulent bank regulating reports which overestimated the bank’s assets.

Continue Reading…

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5 Sent to Prison for Mortgage Scam Involving Falsified Settlement Statements

Allison Tussey —  March 24, 2015 — Leave a comment

Five defendants have been sentenced for their roles in a mortgage fraud conspiracy perpetrated in the Eastern District of Texas involving illegal property flipping, falsification of documents, including HUD-1 Settlement Statements, down payment fraud, and loan application misrepresentations.

Continue Reading…

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