The California Attorney General's Office announced the indictment of six people involving the operation of a mortgage fraud scheme in Southern California. The individuals were charged with a total of 135 felony charges including conspiracy, grand theft, identity theft, forging documents and filing false documents.
Jacob Orona, Aide Orona, John Contreras, Prakashumar “Kash” Bhakta, Marcus Robinson and David Boyd were arrested last week of participating in a scheme that preyed upon homeowners facing foreclosure. The investigation involved joint cooperation between multiple law enforcement agencies into the defendants promising homeowners who are upside down in their homes ways to save their homes. The defendants required an upfront payment of $3,500 and additional monthly payments of $1,000 to file fake legal pleadings including filing fake deeds. This scam resulted in losses of over $4 million and did not save one homeowner from their distress.
Homeowners in San Diego, Los Angeles, Riverside and San Bernardino were the primary targets of the defendants. If convicted, the defendants face from 18-90 years in prison. The fraud stretched through San Diego, Riverside, San Bernardino, and Los Angeles counties.
When the economy collapsed, experts felt the biggest impact was in the housing industry. People were getting mortgages easier than they should have and the financing or balloon mortgages often caused homeowners to miss payments and face foreclosure. As a result, companies started popping up proclaiming to save homeowners from the loss of their homes due to default. While some may have conducted their business with honesty and integrity, many did not. Hundreds of millions of hard dollars were given to individuals who had no intention to assist homeowners. These individuals are the individuals that the state and federal mortgage fraud tasks for are investigating.
California Penal Code Sections 115, Recording False Deeds and PC 487, Grand Theft are the typical code sections alleged in mortgage fraud cases. If charged as a felony in California, an individual can face up to 3 years in state prison. If a victim has a loss of over $65,000, an additional 5 years in state prison is possible.
The California Civil Code also address mortgage fraud in section 2945.4. CCP 2945.4 can be charged as a wobbler meaning it could be either a misdemeanor or a felony. What determines whether prosecutors charge a misdemeanor or a felony include prior criminal history, number of victims and amount of loss. The bigger the fraud the more likely felonies will be alleged.
Due to the formation of the mortgage fraud task force, those being investigated must consult with an attorney at the earliest sign of an investigation. Because of the fact that local, state and federal investigators have joined together to prosecute mortgage fraud, cases could be filed in state or federal court. Early retention of an attorney may be able to mitigate the conduct, defend the conduct or even direct a state filing where the penalties are less severe than in federal court. This could mean the difference from a jail sentence with the possibility of home confinement to mandatory minimum prison sentences in a federal prison.
If you or someone you know is being investigated for mortgage fraud, call our office in Irvine, California for a free consultation. We handle cases throughout California including Los Angeles County, Orange County, San Diego County, Riverside County and San Bernardino County.