7 California residents charged with conspiracy and fraud from alleged mortgage scheme
NEWARK, N.J. — Seven California residents were charged in federal court Tuesday with conspiracy and fraud offenses stemming from an alleged scheme to defraud homeowners across the country who were seeking mortgage loan modifications.
These charges resulted from an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations.
“Some frauds are complex with multiple dimensions but our special agents coupled with all law enforcement multipliers will inevitably uncover the scheme — job well done,” said Special Agent in Charge Terence S. Opiola of HSI Newark.
The defendants made their initial appearance in federal court in Santa Ana, California, and are scheduled to be arraigned on Feb. 17, before U.S. Magistrate Judge William I. Garfinkel in Bridgeport, Connecticut.
According to the indictment:
The defendants jointly operated a series of California-based companies that falsely purported to provide home mortgage loan modification services to numerous homeowners in Connecticut and across the United States in exchange for upfront fees.
The indictment alleges that the homeowners had not been preapproved for mortgage loan modifications with lenders, mortgage loan modifications had not been negotiated with the lenders, homeowners did not qualify for and did not receive any financial assistance through government mortgage relief programs, and homeowners did not receive a refund of their fees upon request. Few homeowners ever received any type of mortgage loan modification through the defendants’ companies, and few homeowners received refunds of their fees.
The indictment further alleges that the defendants used pseudonyms and periodically changed their business and operating names to evade detection. The defendants also directed homeowners to mail their checks to addresses and mail boxes that the defendants and their co-conspirators had set up in states other than California.
According to the indictment, the defendants also routinely ignored cease and desist orders directed at them, including a December 17, 2013 order from the State of Connecticut Department of Banking to cease and desist from charging advance fees to Connecticut residents for mortgage modification services.
The charges carry a maximum term of 20 years on each count, with up to an additional 10 years for participating in a crime that involved telemarketing fraud and victimized 10 or more persons over age 55.
The charges are allegations, and each defendant is presumed innocent until proven guilty.
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