Archives For California

Eva Christine Rodriguez, 65, Laguna Hills, California, and Sergio Lorenzo Lawrence, 46, Laguna Niguel, California, were arrested and charged today with wire fraud offenses in connection with a fraudulent foreclosure rescue scheme that took in more than $5 million in prohibited advance fees from thousands of financially distressed homeowners..

According to the Complaint[1] unsealed today in Manhattan federal court:

From approximately March 2014 through April 2018, Eva Christine Rodriguez and Sergio Lorenzo Rodriguez (the “Defendants”) owned and/or managed a series of mortgage modification companies through which they perpetrated a scheme to defraud and attempt to defraud financially distressed consumers who were facing or were at imminent risk of foreclosure through deceptive marketing practices.  Those companies were National Servicing Center, American Home Servicing Center, National Advocacy Center, National Advocacy Group, and Capital Home Advocacy Center (collectively, the “Companies”).  Among other ways, the Defendants charged desperate homeowners thousands of dollars in prohibited advance fees by tricking them into believing that they had been pre-approved by their lender or servicer for a mortgage modification; falsely represented prohibited advance fees to be closing costs or other non-prohibited costs; fraudulently claimed that the Companies achieved success rates of 95 percent or higher for mortgage modifications; and made empty promises of a no-risk money back guarantee.  As a result of their intentional misrepresentations, and misrepresentations that they encouraged their subordinates to make, the Defendants induced thousands of homeowners to pay an aggregate of more than $5 million in prohibited advance fees to the Companies, including a large number of consumers who were ultimately denied mortgage modifications or who received modification offers that were less favorable than they had been led to expect at the time they paid advance fees.

In February 2018, the Federal Trade Commission brought a civil lawsuit against Eva Christine Rodriguez and Sergio Lorenzo Rodriguez, among others, in federal court in Santa Ana, California.  That civil action resulted first in a temporary restraining order and then a permanent injunction barring the Defendants from marketing and selling all debt relief products and services.  As alleged in the Complaint, the Defendants flouted those judicial orders by having a relative create another mortgage modification company named 1st Premier Asset Solutions, which the Defendants operated using aliases and some of the same deceptive practices.

The Defendants will be presented in federal court in Santa Ana later today.

Each count carries a maximum sentence of 20 years in prison and a maximum fine of $250,000 or twice the gross gain or loss from the offense.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Audrey Strauss, the Acting United States Attorney for the Southern District of New York, and Philip R. Bartlett, Inspector-in-Charge of the New York Office of the United States Postal Inspection Service (“USPIS”) made the announcement.

Acting Manhattan U.S. Attorney Audrey Strauss said:  “As alleged, Eva Christine Rodriguez and Sergio Lorenzo Rodriguez preyed on vulnerable homeowners at risk of foreclosure by making false and misleading promises that they knew they would not or could not keep.  They allegedly continued to do so even after they were barred from the debt relief industry by a federal court in California.  They now face serious criminal charges.

USPIS Inspector-in-Charge Philip R. Bartlett said:  “Loan Modification Scams are a cruel fraud targeting very desperate homeowners faced with losing their homes. While a loan modification may appear to be a lifeline, these scams often become a nightmare. This is allegedly what happened to victims who did business with Eva and Sergio Rodriguez. Postal Inspectors remain on alert for fraud scams targeting consumers, bringing fraudsters to justice worldwide.”

Ms. Strauss praised the investigative work of the USPIS and thanked the Federal Trade Commission and the United States Trustee for Region 5 for their assistance.

This case is being handled by the Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorney Sarah Lai is in charge of the prosecution.

If you believe you are a potential victim of this fraud, please contact Postal Inspector Brandy King-Gonzalez of the USPIS at bnking-gonzalez@uspis.gov, or (212) 330-5252.

The charges contained in the Complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty.

 

Aminullah “David” Sarpas, 37, Irvine, California and Samuel Paul Bain, 40, Tustin, California were sentenced late this afternoon, with one being ordered to serve 12 years in federal prison, for their key roles in businesses that offered bogus modification programs to homeowners struggling to pay their mortgages in the wake of the 2008 financial crisis.

The two defendants who were associated with the Santa Ana, California based company U.S. Homeowners Relief and several related businesses participated in a long-running “advance fee” scheme that caused more than 1,600 homeowners to suffer over $3.5 million in losses. Many victims lost their homes in subsequent foreclosure proceedings.

The Defendants were also co-owners of Greenleaf Modify, Waypoint Law Group, and American Lending Review.

Sarpas and Bain established U.S. Homeowners Relief in late 2008, using it and the subsequent companies to offer programs that falsely offered to help distressed homeowners obtain modifications of their mortgages. Sarpas and Bain initially marketed the programs themselves, but they also used TV, radio and internet advertisements, as well as a team of telemarketers to entice victims. Homeowners who agreed to participate – based on false claims, including that the companies had a 97 percent success rate in obtaining loan modifications that dramatically reduced monthly mortgage payments – were charged an advance fee ranging between $1,450 and $4,200. In short, the scheme “compounded these homeowners’ financial woes by inducing them to dig the hole they were in even deeper,” prosecutors wrote in court documents.

There were two other defendants named in a 2014 indictment. One man was acquitted of all counts. The fourth defendant, Louis Saggiani, 70, Huntington Beach, California pleaded guilty and is scheduled to be sentenced in October.

Sarpas was sentenced to 144 months in federal prison after being convicted by a jury in April 2019 of 10 counts of conspiracy and mail fraud.

Bain was sentenced to five years in prison after pleading guilty in 2016 to conspiracy and mail fraud.

The two men were sentenced by United States District Judge Cormac J. Carney.

The investigation was conducted by the United States Postal Inspection Service, the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) and IRS Criminal Investigation.

This matter was prosecuted by Special Assistant United States Attorney Ryan G. Adams of the Santa Ana Branch Office and Assistant United States Attorney David H. Chao of the Major Frauds Section.

David Daughtrey, 60, El Cajon, California, pleaded guilty in federal court today to bank fraud and tax evasion charges, admitting that over the course of several years he evaded taxes by failing to report $498,612 of income to the IRS, and also orchestrated an illegal scheme to fraudulently obtain a mortgage for his $1.8 million residence using a third party.

Daughtrey admitted that from July 2006 until April 2016, he conspired with others to commit bank fraud and tax evasion. As part of the bank fraud scheme, Daughtrey directed another individual to submit a mortgage application to Wells Fargo to purchase a $1.8 million five-bedroom residence, and to falsely claim that the funds used as down payment belonged to the third party and the residence would be used by the third party.  In reality, Daughtrey provided the funds, and the home was intended to be Daughtrey’s primary residence. Daughtrey made monthly mortgage payments of approximately $8,000 for his residence, but continued to represent to the bank that the third party owned the house.  Daughtrey later submitted a false hardship letter on behalf of the third party in an effort to get the bank to modify the terms of the loan on the home.  As part of the plea agreement, Daughtrey admitted he was the true owner of the residence at all relevant times, and promised to make a good faith effort to transfer the legal ownership of the home into his own name.

Daughtrey also admitted as part his plea that over several years, he and his spouse (who is not charged in the case) conspired to commit tax evasion by filing tax returns listing substantially less income than Daughtrey actually earned.  Daughtrey’s tax return for the year 2012 omitted at least $498,612 in income.  Daughtrey failed to report his total income in tax years 2013, 2014, and 2015, and did not file timely tax returns for subsequent years.  According to the plea agreement, the resulting tax loss to the IRS for the years 2012-2014 was $456,536.   Daughtrey agreed to pay $1,016,457.91 in restitution to the IRS, which includes the total tax loss plus penalties and interest.

As part of his plea agreement, David Daughtrey also agreed to pay over $1 million in restitution to the Internal Revenue Service. He is scheduled to be sentenced on November 16, 2020, before U.S. District Judge Larry A. Burns.

People who cheat on their taxes are cheating all other law-abiding tax payers,” said U.S. Attorney Robert Brewer. “Mr. Daughtrey blatantly disregarded his tax obligations for years.  The defendant not only abused the tax system for his own financial benefit, but conspired to commit bank fraud in order to maintain this lifestyle.” Brewer commended the excellent work of prosecutor Oleksandra Johnson and FBI and IRS agents.

The FBI is dedicated to ensuring that white collar crimes are uncovered and prosecuted,” stated FBI Acting Special Agent in Charge Omer Meisel. “Today, David Daughtrey has admitted to mortgage fraud and tax evasion.  This case illustrates that the FBI will continue to investigate those individuals that engage in fraudulent financial schemes that cause harm to our banking industry and defraud the government of tax revenue.

Our Nation’s tax system funds critical infrastructures and vital programs, including supporting our citizens and small businesses during the ongoing pandemic,” Ryan L. Korner, Special Agent in Charge, IRS Criminal Investigation. “Honest Americans’ compliance with the tax laws is imperative. Rather than pay his fair share, David Daughtrey chose to live lavishly, while intentionally failing to report his true income and evading the payment of over $400,000 in taxes.  Today’s guilty plea demonstrates that the IRS will diligently continue our important enforcement efforts despite the ongoing challenges posed by Covid-19.  We will work alongside our law enforcement partners in a collective effort to enforce the law and ensure the public trust.”

SUMMARY OF CHARGES

Conspiracy to Commit Bank Fraud and Tax Evasion, 18 U.S.C. § 371 (count 1); and

Making a False Tax Return, 26 U.S.C. § 7206(1) (count 2).

Maximum penalty:

Five years’ imprisonment and $250,000 fine (count 1)

Three years’ imprisonment and a maximum fine of $250,000 or twice the gross gain or gross loss resulting from the offense, whichever is greatest (count 2)

AGENCY

Federal Bureau of Investigation

Internal Revenue Service

 

Carlo Hamrahi, Los Angeles, California, was arrested for bilking Florida seniors, on a warrant issued out of Lee County, Florida. The arrest follows an investigation by DFS and OSP uncovering massive mortgage fraud targeting dozens of seniors.

According to an investigation, Hamrahi, using the alias Roberto Colleoni, defrauded home and business owners in Florida by claiming to be a mortgage fraud investigator. Hamrahi promised targets he could get mortgage payments reduced or eliminated by discovering fraud in loan documents. Hamrahi invited victims to seminars and solicited thousands of dollars in upfront fees for these fraudulent services. Hamrahi defrauded at least 24 victims, many 60 or older.

Authorities in California convicted Hamrahi twice previously of similar crimes on the West Coast. Indiana authorities also convicted Hamrahi on similar charges.

Attorney General Ashley Moody’s Office of Statewide Prosecution and Chief Financial Officer Jimmy Patronis’s Department of Financial Services made the announcement.

Attorney General Ashley Moody said, “For many seniors, their homes are their most valuable asset and a cornerstone of their retirement plan. The defendant in this case used the allure of reducing or eliminating mortgage payments to defraud Florida seniors. He promised them financial freedom and in doing so risked losing his own freedom for decades to come. I want to commend my Statewide Prosecutors and DFS investigators for their diligent efforts in this case. I also want to thank California authorities for apprehending the suspect.”

Chief Financial Officer Jimmy Patronis said, “Orchestrating a fraud scheme to take advantage of Floridians is despicable and it’s especially heinous when it’s our seniors who fall victim. These individuals worked their entire lives to build a nest egg and unfortunately scam artists like this will do anything to steal their money. I thank Attorney General Moody’s Office and my fraud investigators for their hard work together in uncovering this scheme and bringing this fraudster to justice.”

Hamrahi is charged with one count of being involved in an organized scheme to defraud, in violation of F.S. 817.034(4)(1). If convicted, Hamrahi faces up to 30 years in prison. Attorney General Moody’s Assistant Statewide Prosecutor Russell C. Stoddard will prosecute the case.

Ruben Rodriguez, 43, and Jaime Mayorga, 41, both of Sacramento, California were convicted and were sentenced, yesterday, each to two years in prison for conspiring to commit wire fraud at a jury trial in April 2019.

According to court documents, between October 2004 and May 2007, Rodriguez and Mayorga were employees of Delta Homes and Lending Inc., a now-defunct Sacramento-based real estate and mortgage lending company that was founded by co-defendant Moctezuma “Mo” Tovar, 50, Sacramento, California. Rodriguez, Mayorga, Tovar, and other Delta Homes employees and co-defendants Manuel Herrera, Davis, California, Sandra Hermosillo, 57, Woodland, California,  Jun Michael Dirain, 47, Antelope, California and Christian Parada Renteria, 43, formerly of Sacramento, California agreed to commit fraud to obtain home loans from mortgage lenders. As part of the scheme, Rodriguez and Mayorga submitted fraudulent mortgage loan applications and supporting documents, which falsely represented the borrowers’ assets and income, liabilities and debts, employment status, citizenship status, and intent to occupy the property. Rodriguez and Mayorga also provided money to the borrowers in order to inflate their bank account balances. Once the loans were secured, the borrowers returned the money. The aggregate sales price of the homes involved in the overall conspiracy was in excess of $10 million. As a result of the conspiracy, mortgage lenders and others suffered losses of at least $4 million. http://www.mortgagefraudblog.com/?s=delta+home+%26+Lending

Tovar was sentenced to 4 ½ years in prison. Herrera was sentenced to one year in prison. Dirain was sentenced to six months in prison, followed by six months of home detention. Hermosillo, was sentenced to nine months of home detention. Parada Renteria pleaded guilty to two counts of concealing felonies related to the wire fraud conspiracy, and was previously sentenced to serve 1 year in prison.

Attorney McGregor W. Scott made the announcement.

This case was the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorneys Brian A. Fogerty and Justin L. Lee prosecuted the case.

 

Latrese Gevon Breaux, 47, was sentenced today for helping run a sophisticated real estate fraud scheme that resulted in the theft of more than $1.4 million from 2014 to 2016.

From July 2014 through September 2016, Angela Cotton, assisted by her co-defendants, used fictitious escrow and title companies that she had created to deceive a lending company into believing it was funding two legitimate real estate transactions.

The group stole the identities of nine people in order to facilitate the fictitious real estate sales. Along with the fake escrow and title companies, the defendants created a fictitious place of employment for one supposed homebuyer under whose name the two loans were approved, the prosecutor said.

To convince the lender of the legitimacy of the transactions and the entities involved, the defendants created fraudulent websites, emails and phone networks along with fake employment documentation and bank account statements from a non-existent financial institution for the borrower.

The lender transferred funds to a bank account it believed to be owned by a legitimate title company but was owned by one of the defendants.

The properties for which the defendants received loans were located in Los Angeles, California and La Cañada Flintridge, California and had not been listed for sale, the prosecutor added. http://www.mortgagefraudblog.com/?s=Latrese+Gevon+Breaux

Breaux, pleaded no contest on February 14, 2019 to one felony count each of grand theft and identity theft, and she admitted an allegation of fraud and embezzlement. She was sentenced to 212 days in county jail. She also is required to complete 200 hours community service and was placed on formal probation for five years under the terms of a plea agreement.

In October, Angela Grace Cotton, 47, was sentenced to 12 years in state prison after pleading no contest to three counts of identity theft, two counts of grand theft and one count each of forgery and money laundering, all felonies.

Denaysha Coleman, 27, was sentenced to three years and eight months in state prison after pleading no contest to one felony count each of grand theft and money laundering.

Lawrence Edward Cotton, 53, was sentenced to two years in state prison after pleading no contest to one felony count each of grand theft and money laundering.

All four defendants are required to pay more than $1.4 million in restitution under the terms of a negotiated plea agreement.

Los Angeles County District Attorney’s Office made the announcement.

Deputy District Attorney Daniel Kinney of the White Collar Crime Division’s Real Estate Fraud Section prosecuted case BA472018.

The case was investigated by the Los Angeles County Sheriff’s Department, Fraud and Cyber Crimes Bureau.

 

Omar Anabo, 57, Vallejo, California has been sentenced to three years in prison for conspiracy to make false statements on loan applications and ordered to pay $379,068 in restitution to victims of the conspiracy.

According to court documents, between Oct. 2004 and May 2007, Anabo and co‑conspirators Sergio Roman Barrientos, 66, and Zalathiel Aguila, 46, operated Capital Access LLC in Vallejo, a company that preyed on homeowners nearing foreclosure. The defendants convinced homeowners to sign over the title to their homes to Capital Access and then spent any equity those homeowners still had, which was then used for operational expenses of the scheme and personal expenses of Anabo and his co-conspirators. http://www.mortgagefraudblog.com/?s=Omar+Anabo

The defendants also used straw buyers to obtain home loans under false pretenses and defraud federally insured financial institutions out of millions of dollars. Vulnerable homeowners across California lost their homes and savings as a result of the scheme, and lenders lost an estimated $10.47 million from the fraud.

Barrientos was sentenced on Nov. 2, 2018, to 14 years in prison for his role in the scheme. Aguila was sentenced on July 26, 2019, to four years in prison.

U.S. Attorney McGregor W. Scott made the announcement.

This case was the product of an investigation by the Federal Bureau of Investigation and the United States Postal Inspection Service. Assistant U.S. Attorneys Matthew M. Yelovich and Christina McCall prosecuted the case.

 

Manuel Herrera, 39, Davis, California was sentenced today to serve one year in prison for conspiring to commit wire fraud.

According to court documents, between October 2004 and May 2007, Herrera was an employee of Delta Homes and Lending Inc., a now-defunct Sacramento-based real estate and mortgage lending company that was founded by co-defendant Moctezuma “Mo” Tovar, 50, Sacramento, California. Herrera, Tovar, and other Delta Homes employees and co-defendants agreed to commit fraud to obtain home loans from mortgage lenders. As part of the scheme, Herrera submitted fraudulent mortgage loan applications and supporting documents, which falsely represented the borrowers’ assets and income, liabilities and debts, employment status, citizenship status, and intent to occupy the property. Herrera also provided money to the borrowers in order to inflate their bank account balances. Once the loans were secured, the borrowers returned the money to Herrera. The aggregate sales price of the homes involved in the overall conspiracy was in excess of $10 million. As a result of the conspiracy, mortgage lenders and others suffered losses of at least $4 million.

Herrera is the fifth defendant sentenced as part of the scheme. Co-defendant Tovar was sentenced to four and a half years in prison; Jun Jun Michael Dirain, 47, Antelope, California was sentenced to six months in prison, followed by six months of home detention; Sandra Hermosillo, 57, Woodland, California was sentenced to nine months of home detention; Christian Parada Renteria, 43, formerly of Sacramento, California was sentenced to serve one year in prison.

Co-defendants Jaime Mayorga, 40, and Ruben Rodriguez, 42, both of Sacramento, California were convicted of conspiracy to commit wire fraud at a jury trial. They are scheduled to be sentenced by U.S. District Judge John A. Mendez on December 10, 2019. Each defendant faces a maximum statutory penalty of 20 years in prison and a $250,000 fine. The actual sentence, however, 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.

U.S. Attorney McGregor W. Scott made the announcement.

This case was the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorneys Brian A. Fogerty and Justin L. Lee prosecuted the case.

 

Angela Grace Cotton, 47, Denaysha Coleman, 27, Lawrence Edward Cotton, 52 have been sentenced for running a sophisticated real estate fraud scheme that resulted in the theft of more than $1.4 million from 2014 to 2016.

From July 2014 through September 2016, Cotton, assisted by her co-defendants, used fictitious escrow and title companies that she had created to deceive a lending company into believing it was funding two legitimate real estate transactions.

The group stole the identities of nine people in order to facilitate the fictitious real estate sales. Along with the fake escrow and title companies, the defendants created a fictitious place of employment for one supposed homebuyer under whose name the two loans were approved, the prosecutor said.

To convince the lender of the legitimacy of the transactions and the entities involved, the defendants created fraudulent websites, emails and phone networks along with fake employment documentation and bank account statements from a non-existent financial institution for the borrower.

The lender transferred funds to a bank account it believed to be owned by a legitimate title company but was allegedly owned by one of the defendants.

The properties for which the defendants received loans were located in Los Angeles and La Cañada Flintridge and had not been listed for sale, the prosecutor added.

Cotton was sentenced yesterday to 12 years in state prison after pleading no contest to three counts of identity theft, two counts of grand theft and one count each of forgery and money laundering, all felonies.

Coleman was sentenced to three years and eight months in state prison after pleading no contest to one felony count each of grand theft and money laundering.

Cotton was sentenced to two years in state prison after pleading no contest to one felony count each of grand theft and money laundering.

All three defendants admitted allegations of fraud and embezzlement resulting in the loss of more than $500,000.

They are required to pay more than $1.4 million in restitution under the terms of a negotiated plea agreement.

A fourth defendant, Latrese Gevon Breaux, 47, pleaded no contest on February 14, 2019 to one felony count each of grand theft and identity theft, and she admitted an allegation of fraud and embezzlement.

She is expected to be sentenced to five years of formal probation and 106 days in county jail for time served on December 4, 2019 in Department 50 of the Foltz Criminal Justice Center. She also is required to complete 200 hours of community service under the terms of a plea agreement.

The Los Angeles County District Attorney’s Office made the announcement today.

Deputy District Attorney Daniel Kinney of the White Collar Crime Division’s Real Estate Fraud Section prosecuted case BA472018.

The case was investigated by the Los Angeles County Sheriff’s Department, Fraud and Cyber Crimes Bureau.

View PDF

Steven Rogers, Robert Sedlar, and Audrey Gan, the operators of Grand View Financial, were indicted today on a 121-count felony indictment for allegedly operating a mortgage fraud scheme throughout California.

The victims, many of whom were elderly and in financial distress, sought mortgage relief services from Grand View Financial in the Counties of San Diego, San Mateo, Alameda, Contra Costa, San Joaquin, Placer, Solano, Mendocino, San Francisco, El Dorado, and Sacramento.

Between 2015 and 2019, the defendants allegedly conspired to steal money and homes from distressed homeowners using a company called Grand View Financial. The company launched a mortgage and foreclosure assistance program that advertised assistance to desperate homeowners facing foreclosure. The defendants promised consumers that if they transferred their house and paid money to Grand View Financial, the company would eliminate the mortgage lien and deed the home back to the homeowner, clear of any liens. During this time, the defendants allegedly filed false court proceedings, false documents with the county recorders offices, and false bankruptcies.

The trio was indicted by a grand jury in the Sacramento Superior Court for conspiracy, grand theft, elder abuse, filing false or forged documents in a public office, and engaging in a prohibited act as a foreclosure consultant.  The scheme resulted in a combined loss of over $7 million.

California Attorney General Xavier Becerra made the announcement.

Individuals who prey on vulnerable communities to enrich themselves will be held accountable by the California Department of Justice,” said Attorney General Becerra. “My office will continue to work with our law enforcement partners to identify and prosecute those who disregard the rule of law.”

The indictment and arrests are the result of a joint investigation by the California Department of Justice, Fraud and Special Prosecutions Section and White Collar Crime Team; the United States Office of Inspector General, Federal Deposit Insurance Corporation; the United States Office of Inspector General, Federal Housing Finance Agency; the United States Trustee Program; the United States Marshals Service; the Stanislaus County District Attorney’s Office; and the El Dorado County District Attorney’s Office.

Attorney General Becerra is committed to protecting Californians from mortgage fraud and other financial crimes. If you believe you may have been targeted by Grand View Financial, please contact the California Department of Justice. For those located in California, please call: 1-800-952-5225. For those located outside of California, please call: 1-916-322-3360.

It is important to note that a criminal indictment contains charges that must be proven in a court of law. Every defendant is presumed innocent until proven guilty.

A copy of the indictment can be found here.