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Artesia Predatory Lending Attorneys on Elaborate Bay Area Mortgage Fraud Scheme

March 16, 2009

The Department of Justice's office in the Eastern District of California announced Feb. 20 (PDF) that it has indicted five people in a mortgage fraud scheme causing an estimated $1 million in losses. According to the U.S. Attorney's office, the scheme started with home buyer Dennis Moore, who bought several properties in and around Lake Tahoe. Moore insisted on very large commissions for his real estate agent, alleged co-conspirator Haiying Fan, and agreed to pay substantially above market price to achieve this. He then had alleged co-conspirators Veronika Wright, a mortgage broker, Gary George, a tax professional, and Mitchell Wright help falsify his income. Fan then kicked back the majority of the commission to Moore.

In the popular imagination, mortgage fraud is most often the work of an individual home buyer who lies about his or her income in order to afford a home. That most certainly does happen, but as Southern California predatory lending lawyers, we are also interested in mortgage fraud by brokers and other financial professionals. This conspiracy involved professionals in nearly every part of the real-estate-buying chain: a buyer, a real estate agent, a mortgage broker and even a tax professional. Most of these people would understand the home-buying process much better than the average home buyer, which puts them in a good position to exploit buyers (and sellers) who don't understand the process or their rights.

As the DoJ press release notes, the harm that stems from mortgage fraud goes beyond losses to the bank. For one thing, mortgage fraud can directly harm buyers who are taken in by misleading statements or outright lies by brokers or lenders. For another, mortgage fraud usually means a quick foreclosure, which hurts nearly everyone involved in some indirect way -- investors who lose money, other home buyers who can't get a loan, even neighbors who watch their property values decline. As we are currently seeing, too many foreclosures can have a negative effect on the national or even global economy.

Mortgage fraud, when committed by a broker or a lender, is a form of predatory mortgage lending -- and predatory lending is illegal under multiple state and federal laws. If you believe you were lied to when you refinanced or originally purchased a home, you may be a victim. Howard Law LLP's Cerritos predatory lending attorneys can help clients sue to recover all of the payments they made on an illegal, unfair loan, as well as attorney fees and other costs of the lawsuit itself. If this situation sounds all too familiar to you, please contact us online or call us at 1-800-872-5925 for a free, confidential consultation.