This article is published by Monique Bryher as part of the California Real Estate Fraud Report.
SACRAMENTO – California Attorney General Xavier Becerra today announced the arrest and arraignment of nine individuals on 136 felony counts for allegedly operating an advance fee mortgage relief scam that claimed to prevent the foreclosure of properties throughout Southern California. The alleged scheme impacted multiple victims, resulted in a loss of approximately $6 million, and affected over 200 properties; including properties with loans insured by the Federal Housing Administration (FHA), as well as loan servicers Freddie Mac, and Fannie Mae. Each defendant pleaded not guilty at their arraignment.
The arrests were the result of a joint investigation by the California Department of Justice’s Division of Law Enforcement’s White-Collar Investigation Team, along with the Federal Housing Finance Agency Office of Inspector General (FHFA-OIG), and the United States Department of Housing and Urban Development Office of Inspector General (HUD-OIG). The Riverside County Sheriff’s Gang Impact Team assisted in the arrest, and further assistance was provided by the United States Trustee Program.
“Individuals who choose to prey on vulnerable Californians at risk of losing their homes will be held accountable,” said Attorney General Becerra. “The Department of Justice will continue to work with our law enforcement partners to identify and prosecute those who disregard the law in order to make a profit.”
“Our objective is to ensure that the public is not taken advantage of when they have fallen on hard financial times,” said Michael Gibson, the Special Agent in Charge of the HUD-OIG. “Distressed homeowners are particularly vulnerable to this type of fraud. An important message has been sent today to those who prey upon homeowners who are seeking financial assistance with their mortgage and we will remain vigilant to hold them accountable. This type of fraud not only affects individual families, it also affects the housing market.”
“The defendants have been charged with victimizing struggling homeowners and defrauding Fannie Mae and Freddie Mac,” said Jay Johnson, Special Agent in Charge of the FHFA-OIG, Western Regional Office. “We are proud to have worked with the California Attorney General’s Office on this case and to demonstrate, once again, that FHFA-OIG will investigate and hold accountable those who seek to victimize the Government Sponsored Entities supervised and regulated by FHFA.”
On October 30, 2020, Eduardo Toro, Ana Cecilia Toro, Veronica Romero (aka Veronica Marquez), Veronica Toro, Filiverto Gomez, Leticia Mora, Maria Gil, Emmanuel Lopez, and Gladys Velasquez were indicted by a grand jury in the Los Angeles County Superior Court for grand theft, filing of false or forged documents in a public office, identity theft, theft from an elder, and conspiracy to commit grand theft, as well as a special allegation for aggravated white-collar crime.
Between 2010 and 2019, the defendants allegedly conspired to defraud lenders and homeowners of possession of residential properties. As part of the scheme, the group allegedly targeted distressed homeowners claiming they could stop the foreclosure of their home if they made monthly payments to the defendants. Instead, the defendants delayed foreclosures and eviction actions by filing allegedly fraudulent bankruptcy documents, false court documents, and false fractional interest grant deeds. They sent these documents to the servicers of mortgage loans, which would stop the foreclosure by invoking the bankruptcy “automatic stay.” Many homeowners lost their homes to foreclosure despite paying the defendants hundreds of dollars a month over the course of many years.
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 is available here.