David Marshall Crisp, 31, Carlyle Lee Cole, 63, Julie Dianne Farmer, 42, Sneha Ramesh Mohammadi, 49, Jayson Peter Costa, 38, Jeriel Salinas, 29, Robinson Dinh Nguyen 30, Michael Angelo Munoz, 31, Jennifer Anne Crisp, 29, and Caleb Lee Cole, 35, all from California, have been charged in a 56-count indictment with conspiracy to commit bank, mail and wire fraud, and with individual counts of mail fraud. Certain of the defendants were also charged with wire fraud, bank fraud, and conspiracy to launder money. The indictment was returned January 13th, 2010, by a federal grand jury in Fresno, California.
Defendant David Crisp was arrested in San Diego, California. Defendant Carlyle Cole was arrested in Ventura County, California. Farmer, Mohammadi, Costa, Salinas, Munoz, and Caleb Cole were arrested in Bakersfield, California. Defendant Nguyen was arrested in Monterey, California. Defendant Jennifer Crisp just surrendered to authorities.
Defendants David Crisp and Carlyle Cole were the owners of Crisp, Cole & Associates (CCA), also known as Crisp & Cole Real Estate. They also controlled Tower Lending, CCA’s in-house mortgage broker business. Defendants Julie Farmer, Sneha Mohmamadi, Jayson Costa, Jeriel Salinas, Robinson Nguyen, and Michael Munoz, were employed at CCA and/or at Tower Lending. Jennifer Crisp is the wife of David Crisp and Caleb Cole is the son of Carlyle Cole. Five other persons, including Megan Balod, Leslie Sluga, Kevin Sluga, a CPA who handled accounting matters for CCA, and Jerald Teixeira and Christopher Stovall, both former loan officers for Tower Lending, have previously pleaded guilty in related cases.
The indictment alleges that, from approximately January 2004 to September 2007, the defendants perpetrated a scheme to defraud mortgage lenders by submitting fraudulent loan applications with material misrepresentations, including misrepresentations concerning the borrower’s income, assets, employment status, and intent to use the home as the borrower’s primary residence. The indictment alleges that the defendants perpetrated the scheme in part by flipping homes, which is the selling of a single home on multiple occasions, through a series of fraudulent transactions to co-defendants, straw buyers, and others in order to artificially inflate the prices of the residences. The defendants typically increased the loan amounts and used close to 100 percent financing, in order to extract the inflated equity amounts from the properties on each financing transaction. CCA generally acted as the real estate brokerage on the sales, and Tower Lending acted as the mortgage brokerage on the financing transactions, generating substantial commissions and fees for the defendants on each transaction. The scheme involved more than $20 million in losses to lenders.
California United States Attorney Benjamin B. Wagner made the announcement.
U.S. Attorney Wagner said, “In the mid-2000s, Crisp, Cole, and Associates was a high-flying real estate firm. Like the housing markets that fueled its rise, Crisp, Cole and Associates has now crashed, bringing many people down with it. When mortgage fraud is committed on a broad scale, as alleged in this indictment, the mortgage lenders are not the only victims. Fraud schemes that involve rapid inflation of real estate prices followed by sudden foreclosures create a market roller coaster that takes many innocent home owners along for the ride.”
Special Agent in Charge of the Sacramento FBI Herb Brown said, “Many people in Bakersfield lost their homes as a result of these frauds and many will spend years trying to repair the damage that has been done not only to their credit but to their personal lives. By no stretch of the imagination are these ‘victimless’ crimes.”
This case is the product of an extensive investigation by the Federal Bureau of Investigation with assistance from the Department of Housing and Urban Development – Office of Inspector General. They were assisted by the Bakersfield Police Department. Assistant U.S. Attorneys Stanley A. Boone and Kirk E. Sherriff are prosecuting the case.
The maximum statutory penalty for the conspiracy, mail fraud, wire fraud, and bank fraud counts is 30 years in prison and a $1 million fine. The maximum penalty for money laundering is 10 years in prison and a fine of $500,000. Any sentence will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
The charges are only allegations and the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.