Grand Jury Indicts 11 Allegedly Linked to an Inland Empire Loan Modification Scam That Targeted Financially Distressed Homeowners

September 13, 2012

The Federal Bureau of Investigation (FBI) on September 12, 2012 released the following:

“LOS ANGELES— Federal agents this morning arrested 10 defendants who worked at a Rancho Cucamonga-based business that allegedly offered bogus loan modification programs to financially distressed homeowners. As a result of the scheme allegedly run out of 21st Century Real Estate Investment Corp. and several related companies, more than 4,000 financially distressed homeowners lost at least $7 million in fees they paid to the company, and many homeowners lost their homes to foreclosure.

Those taken into custody this morning were among 11 defendants named in a federal indictment unsealed today following an investigation by the Federal Bureau of Investigation, IRS-Criminal Investigation, the United States Postal Inspection Service, the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), and the Federal Housing Finance Agency, Office of Inspector General.

According to the indictment, during an 18-month period that began in June 2008, a Rancho Cucamonga woman, Andrea Ramirez, operated 21st Century and several other companies. According to the indictment, 21st Century “defrauded financially distressed homeowners by making false promises and guarantees regarding 21st Century’s ability to negotiate loan modifications from the homeowners’ mortgage lenders, falsely representing that 21st Century was operating a loan modification program sponsored by the United States government, instructing homeowners to cease communication with their mortgage lenders and to cease making their mortgage payments.”

“The housing crisis provided fraud artists a new avenue to exploit people in financial distress,” said United States Attorney André Birotte Jr. “Many of the victims in this alleged scheme were in desperate financial straits, and shameless financial predators promised relief they could not deliver. As a result, many homeowners went into foreclosure and now have to deal with the ramifications of losing their homes.”

Ramirez and the other 21st Century employees contacted distressed homeowners through cold calls, newspaper ads and mailings, and various 21st Century-controlled websites that advertised loan modification services. Once they contacted the distressed homeowners, according to the indictment, Ramirez and other 21st Century employees often falsely told clients that the company was operating through a federal government program, that they would be able to obtain new mortgages with specific interest rates and reduced payments, and that attorneys would negotiate loan modifications with their lenders. Ramirez and other 21st Century employees regularly instructed financially distressed homeowners to cease making mortgage payments to their lenders and to cut off all contact with their lenders because they were being represented by 21st Century. On some occasions, Ramirez and other 21st Century employees would tell homeowners that 21st Century was using the fees paid by the homeowner to make mortgage payments, when in fact Ramirez and 21st Century simply were keeping the homeowner’s money.

Christy Romero, Special Inspector General at SIGTARP, stated: “Ramirez and her co-conspirators are charged with fraudulently operating 21st Century to exploit the hardships of homeowners fighting to keep a roof over their head. As alleged, these con artists swindled distressed homeowners by lying about their affiliation with federal housing programs and giving money-back guarantees that the homeowners would get a lower mortgage payment if they paid an advance fee. SIGTARP and our law enforcement partners are committed to shutting down schemes that prey on those who can least afford it by falsely claiming an affiliation with TARP’s housing programs.”

Leslie P. DeMarco, Special Agent in Charge of the IRS-Criminal Investigation’s Los Angeles Field Office, said: “Using the guise of a federally sponsored loan modification program and the assurance of a qualified legal team, the defendants preyed on financially distressed homeowners allegedly depriving them of much needed money and property. Those who find ways to fraudulently benefit from government programs meant to help struggling homeowners keep their homes will be brought to justice.”

The 11 defendants named in the indictment are:

  • Andrea Ramirez, who also used the names Andrea Parker and Lisa Evans, 44, of Rancho Cucamonga;
  • Christopher Paul George, 42, Rancho Cucamonga, who surrendered this morning to authorities;
  • Michael Bruce Bates, who also used the names Michael Bruce Myers and Robert Allen Castro, 61, of Moreno Valley;
  • Crystal Taiwana Buck, 37, of Long Beach;
  • Michael Lewis Parker, 34, of Pomona, who is currently a fugitive being sought by federal authorities;
  • Catalina Deleon, 35, of Glendora;
  • Hamid Reza Shalviri, 50, Montebello, who self-surrendered this morning after being contacted by federal agents;
  • Yadira Garcia Padilla, 35, of Rancho Cucamonga;
  • Mindy Sue Holt, 53, of San Bernardino;
  • Iris Melissa Pelayo, 42, of Upland; and
  • Albert DiRoberto, 59, of Fullerton.

The defendants arrested this morning are expected to be arraigned this afternoon during their initial court appearances in United States District Court in Riverside.

“Fraudulent loan modification scams affect consumers at the most basic level, jeopardizing their ability to retain ownership of their homes,” said B. Bernard Ferguson, Inspector in Charge of the U.S. Postal Inspection Service-Los Angeles Division. “The U.S. Postal Inspection Service will investigate these crimes to protect consumers and when the nation’s mail system is used for illegal or dangerous use.”

Steve Linick, the Federal Housing Finance Agency Inspector General, stated: “The government created programs intended to assist homeowners by allowing them to remain in their homes during these troubling financial times. Anyone attempting to engage in schemes designed to exploit struggling homeowners and the government programs created to help those same homeowners will ultimately be brought to justice.”

All 11 defendants are charged with nine felony counts—five counts of mail fraud, three counts of wire fraud, and one count of conspiracy. Each count in the indictment carries a statutory maximum penalty of 20 years’ imprisonment.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.

This prosecution is part of efforts by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 United States Attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants, including more than 2,700 mortgage fraud defendants. For more information on the task force, visit http://www.stopfraud.gov.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Christopher S. Godfrey, Dennis Fischer, Vernell Burris Jr, and Brian M. Kelly Indicted by a Boston Federal Grand Jury for Conspiracy, Wire Fraud, Mail Fraud and Misuse of a Government Seal

August 9, 2011

The Department of Justice (DOJ) on August 9, 2011 released the following:

“Four Florida Men Charged in Boston with Defrauding Homeowners in Home Loan Modification Scam

WASHINGTON – Four Florida men were arrested today on charges that they defrauded homeowners in Massachusetts and elsewhere in connection with a home loan modification scam, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Carmen M. Ortiz for the District of Massachusetts and Christy Romero, Acting Special Inspector General for the Troubled Asset Relief Program (SIGTARP).

A 20-count indictment was unsealed today in federal court in Boston, charging Christopher S. Godfrey, 42, of Delray Beach, Fla.; Dennis Fischer, 40, of Highland Beach, Fla.; Vernell Burris Jr, 51, of Boynton Beach, Fla.; and Brian M. Kelly, 34, of Boca Raton, Fla., with conspiracy, wire fraud, mail fraud and misuse of a government seal. The defendants were arrested today by SIGTARP agents and will make their initial appearances in U.S. District Court in West Palm Beach, Fla., tomorrow at 10 a.m. EDT.

According to the indictment, Godfrey was the president and Fischer was the vice president and treasurer of a Florida company called Home Owners Protection Economics Inc. (HOPE). Burris was the manager and primary trainer of HOPE telemarketers, while Kelly was one of the principal telemarketers as well as a trainer for other HOPE telemarketers.

The indictment alleges that from January 2009 through May 2011, the defendants made, and instructed their employees to make, a series of misrepresentations to induce financially distressed homeowners looking for a federally-funded home loan modification to pay HOPE a $400-$900 up-front fee in exchange for HOPE’s home loan modifications, modification services and “software licenses.” According to the indictment, these misrepresentations included claims that homeowners were virtually guaranteed, with HOPE’s assistance, to receive a loan modification under the Home Affordable Modification Program (HAMP), which is part of TARP and is a federally-funded mortgage assistance program. Additional misrepresentations to homeowners included that HOPE was affiliated with the homeowner’s mortgage lender, that the homeowner had been approved for a home loan modification, that homeowners could stop making mortgage payments while they waited for HOPE to arrange their loan modification and that HOPE would refund the customer’s fee if the modification was not successful. HOPE also claimed that it operated as a non-profit organization.

In exchange for these up-front fees, HOPE allegedly sent its customers, including homeowners in Massachusetts, a do-it-yourself application package that was nearly identical to the application the U.S. government provides free of charge. HOPE instructed customers to fill out the application and submit it to their mortgage lender. According to the indictment, the HOPE customers who did use the provided forms to apply on their own for loan modifications had no advantage in the application process, and, in fact, most of their applications were denied. Through these misrepresentations, HOPE was able to persuade thousands of homeowners collectively to pay more than $3 million in fees to HOPE.

Godfrey and Fischer were charged with one count of conspiracy, nine counts of wire fraud, nine counts of mail fraud and one count of misuse of a government seal. Burris and Kelly were charged with one count of conspiracy, nine counts of wire fraud and nine counts of mail fraud. Each count of conspiracy and misuse of a government seal carries a maximum penalty of five years in prison and a $250,000 fine. Each count of mail and wire fraud carries a maximum penalty of 20 years in prison and a $250,000 fine. All of the defendants face possible orders of restitution.

An indictment is merely an allegation and defendants are presumed innocent unless and until proven guilty in a court of law.

The case was investigated by SIGTARP and is being prosecuted by Assistant U.S. Attorney Adam Bookbinder in the Computer Crimes Unit at the U.S. Attorney’s Office, and Mona Sedky of the Computer Crime and Intellectual Property Section in the Justice Department’s Criminal Division.”

To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN List Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

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