9 year fraud battle has a happy ending.

Over the years I’ve written a lot about real estate fraud. Real estate fraud had only just come to our region in a big way back in 2005/2005 and Realtors® were trying to grapple with this new issue. Problem was, nobody else thought it was an issue. Banks didn’t care, law enforcement wasn’t interested, our DA, the Dept. of Real Estate, FBI – you name it, nobody cared.

And over the years I’ve written a lot about the Stonewood Case – a house kiting scheme with some investment undertones. By the time the law finally got on the case, the perp’s were indicted for $143 MILLION dollars. Yeah, not exactly chump change. It really jump started our foreclosure market back in 2006-2007 as these places started to dump back onto the market in ever increasing numbers.

It’s been a 9 year effort led by local Realtors®, some tenacious reporters, our board attorney and a bunch of victims who weren’t afraid to stand up.

Yesterday the last two perp’s were found guilty. Hendrix Montecastro and his mother Helen Padrino. There were 9 people indicted, the others were so guilty they all plead guilty. These two decided to test it in court and act as their own counsel. Yeah, that worked well. So instead of the few or tens of years their cohorts were dealt, Padrino is up for 30+ and Hendrix is down for 100.

All I can say is, he looks a lot better in his orange jumpsuit than he did in the 3 piece Armani’s he used to sport when he’d come into the office to try to intimidate us. Sentencing comes in a couple weeks.

You can read some of the history and testimony here:

http://www.pe.com/business/business-headlines/20130325-fraud-trial-guilty-verdicts-in-multimillion-dollar-ponzi-case.ece


CA Attorney General files suit in massive 17 state mortgage fraud scheme.

CA State Attorney General Kamala Harris sued Philip Kramer, the Law Offices of Kramer & Kaslow, two other law firms, three other lawyers, and 14 other defendants who are accused of working together to defraud homeowners across the country through the deceptive marketing of “mass joinder” lawsuits. Prominent foreclosure attorneys Phillip Kramer and Mitchell Stein and at least 17 others have been accused of luring desperate homeowners into the scheme using deceptive advertising and telemarketing schemes aimed at millions of people in California and 16 other states.

The scheme claimed that courts have found that most mortgage lenders engaged in predatory lending practices or approved inappropriate loans (well, that part is certainly true), and that the homeowners bank was one of the guilty. As alleged in the lawsuit, defendants preyed on desperate homeowners facing foreclosure by selling them participation as plaintiffs in mass joinder lawsuits against mortgage lenders. Defendants deceptively led homeowners to believe that by joining these lawsuits, they would stop pending foreclosures, reduce their loan balances or interest rates, obtain money damages, and even receive title to their homes free and clear of their existing mortgage. Defendants charged homeowners retainer fees of up to $10,000 to join as plaintiffs to a mass joinder lawsuit against their lender or loan servicer.

It probably comes as no surprise that theses same ‘prominent foreclosure attorneys’ had previously been ‘prominent loan modification specialists’ but it is alleged that Kramer sent an email to another fellow defendant last year stating “Only morons would prefer to ‘sell’ mods from this day forward”.
Homeowners who have paid to be added to one of the lawsuits should contact the State Bar if they feel they may be victims of this scam. They can also contact a HUD-certified housing counselor for general mortgage related assistance. If you have sent money to any of the following seized entities, you should contact the CA Attorney Generals Office at http://oag.ca.gov/.

The Department of Justice has seized the practices of the following non-attorney defendants: Attorneys Processing Center, LLC; Data Management, LLC; Gary DiGirolamo; Bill Stephenson; Mitigation Professionals, LLC; Glen Reneau; Pate Marier & Associates, Inc.; James Pate; Ryan Marier; Home Retention Division; Michael Tapia; Lewis Marketing Corp.; Clarence Butt; and Thomas Phanco as well as seizing the practices and accounts of attorney defendants:The Law Offices of Kramer & Kaslow; Philip Kramer, Esq; Mitchell J. Stein & Associates; Mitchell Stein, Esq.; Christopher Van Son, Esq.; Mesa Law Group Corp.; and Paul Petersen, Esq.

Attorney General Harris is challenging the defendants’ alleged misconduct in marketing their mass joinder lawsuits; her office takes no position as to the legal merits of any claims asserted in the mass joinder lawsuits filed by defendants.

Victims in the following states are known to have received these mailers, or signed on to join the case. This is a preliminary list that may be updated:

Alaska, Arizona, California, Colorado, Connecticut, Florida, Hawaii, Maryland, Massachusetts, Michigan, Missouri, Nevada, New Jersey, New York, Ohio, Texas, Washington.

For more information please go to: http://oag.ca.gov/news/press_release?id=2552


Update: CA State Bar v. Michael T. Pines. SHARK ATTACK!

Last October I wrote about a local attorney by the name of Michael T. Pines who was making quite a name for himself in local real estate circles. (Another Real Estate Scam to beware of.) Counselor Pines was making the evening news by advising clients who had been foreclosed on and evicted to break back into their former homes under the theory that since the debt had been satisfied through foreclosure, they could now own their former home free and clear.

To say this hadn’t worked would be an understatement. Clients who actually followed his advice were summarily re-evicted if they were lucky and arrested if they were not. After all, the homes were now the property of the bank and in some cases had already been resold so charges of breaking and entering and other minor misdeeds were alleged.

Turns out Mr. Pines himself was in foreclosure on some homes he owned and lost his own law office building to foreclosure (he didn’t try to break into his own building). At that time a judge had also slapped him with a $16,000 fine for filing frivolous lawsuits and for wasting his time and not acting in the best interest of his clients.  He also had a couple restraining orders against him for civil harassment after a trial and had been cited for contempt at least once.

law

Today attorneys for the State Bar of California asked a judge to suspend the law license of Mr. Pines. According to the state bar, Pines behavior had become ‘so
egregious’ that it filed to have his license suspended on an interim basis while it seeks a permanent removal. Jeez, that’s like watching sharks attack another shark – gruesome yet exciting, and as rare in legal circles as it is in nature.

Chief Trial Counsel James Towery was quoted in a written statement as saying “To remove a lawyer from active practice before formal charges are filed is a drastic remedy. In this case, that remedy is justified by the established misconduct of Michael T. Pines, who has shown complete disrespect for the law, the courts and especially the best interest of his clients.” Duh.

Never to be outdone, Pines has filed his own lawsuit against the state bar. “I’m sure the charges are going to be thrown out,” says Pines. “They’re going to be really embarrassed when they find out the truth.”

Hmm, attorneys vs. attorney. I’m guessing the truth might be a rare commodity in this v enue. Of course that’s just my opinion, I could be wrong.

Meanwhile people who have already suffered through a legal foreclosure in Southern California will not have the opportunity to be further victimized by this predator – at least until he teaches the state bar a lesson and gets his dorsal fin back.

fin

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The opinions in this commentary are strictly Gene Wunderlich’s personal opinions. While any reasonable and/or rational indivdual should agree wholeheartedly, the opinons reflected herein may not necessarily be those of the Southwest Riverside County AOR, or any local or state government or other mental institution.

Court Bars Further Implementation of AB32

As we were wrapping up our Board of Directors meetings last week, the Superior Court of California in San Francisco barred further implementation of AB 32 pending CEQA compliance.  In Association of Irritated Residents, et al. v. California Air Resources Board, et al., the Superior Court issued a “tentative statement of decision” (Tentative Decision) that prevents the California Air Resources Board (CARB) from implementing a state-wide Green House Gas reduction regulatory program under AB 32 until the agency complies with the requirements of the California Environmental Quality Act (CEQA).

AB 32, the state’s landmark 2006 climate change statute, required CARB to develop a regulatory program to reduce state-wide GHG emissions to 1990 levels by 2020.  In response to this mandate, the Board of CARB already approved a first set of comprehensive regulations in December 2010; the regulations were based on an earlier “Scoping Plan” developed by the CARB staff.   The Tentative Decision partially grants a petition for a writ of mandate brought by a coalition of environmental justice organizations (Petitioners) that alleged that CARB’s Scoping Plan violated both AB 32 and CEQA. “Environmental Justice” is the fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies.

Although the Superior Court denied all claims related to AB 32, the court found that CARB: 1) failed to adequately discuss and analyze the impacts of alternatives in its proposed Scoping Plan as required by its CEQA implementing regulations; and 2) improperly approved the Scoping Plan prior to completing the environmental review required by CEQA.  In upholding the Petitioners’ challenge on these two CEQA issues, the Superior Court issued a Peremptory Writ of Mandate and enjoined CARB from further implementation of the Scoping Plan until it complies with all CEQA requirements. Parties to the case have 15 days from the issuance of the Tentative Decision to file objections before the Superior Court issues a final decision in the case.

While this is good news for some, the order to stop the implementation of AB 32 has little effect on the housing sector and will not affect other Green House Gas reducing mandates already in place such as SB 375: the anti-sprawl law which requires regional governments to reduce Green House Gas emissions via land use and transportation planning, and AB 758: which will require energy efficient retrofits in California’s existing homes and commercial properties. The stay will, however, affect the development of regulations concerning Cap-and-Trade, Low Carbon Fuel Standards, Renewable Energy, Landfills, Vehicles, Industrial Emissions, etc.

C.A.R. took a neutral position on AB 32 when it passed through the legislature in 2006.  At the time, C.A.R. did not find tailpipe emissions reductions and cap-and-trade policies to be of direct and immediate concern to REALTORS®.  Subsequent to the passage of AB 32, C.A.R. has monitored AB 32 implementation planning and policy development meetings. C.A.R. remains neutral on the goal of GHG reduction yet continues to urge CARB and other state agencies to consider the real cost of doing business and to take a realistic approach to the implementation of their rules and policies.


Murrieta men agree to prison in fraud case

The headline was exciting yesterday when news of our long-time resident scam artists started to trickle out. The authors of a $142 million dollar ponzi scheme & investment fraud have been in jail awaiting this moment for the past 1 1/2 years and now start to look forward to doing the rest of their time.

Long-time readers will be familiar with the Stonewood case, wherein these perpetrators enticed hundreds of people to invest in real estate. But not just invest – they were talked into buying homes for $100,000 or more over asking price with that overage going to the third party – Stonewood. People who could barely qualify for a car loan were talked into buying multiple properties, most i the $500,000 and over range, with the promise that the deficit between rental payments and the mortgage payment would come out of an investment fund seeded by that ‘overage amount’.

In some cases deficit payments were made for a month or so but quickly vanished as the perpetrators lived large, driving fancy cars, boats and living in multi-million dollar homes themselves. Ultimately over 200 homes went onto foreclosure, many starting in 2006 – well before the foreclosure crisis started. This wave of dead lawns jump-started our local foreclosure fiasco as the 200 homes were dumped onto the market along with dozens more from people who had bought in neighborhoods where the fraudulent purchases has driven up the comps.

Our local real estate association started noticing these transactions in late 2004 and by mid-2005 had compiled an extensive dossier on the scheme. At that time it involved about 60 homes and maybe $30 – $40 million dollars. We tried in vain to get local law enforcement, our District Attorney, our Dept. of Real Estate, the FBI – ANYBODY – to take an interest. To no avail.

Finally in late 2007 the SEC got involved not from the real estate side but from the investment fraud angle. This prompted the DRE to yank the brokers license from the principles but by then the damage had largely been done. Finally in 2008, the Justice Department, FBI and our DA got involved and brought the scanm to a screeching halt. Of course by then it had ballooned from 60 homes and $30 million to over 200 homes and $140+ million. Our DA was all puffed up taking credit for this great bust when, for years we had not even been able to get a meeting with him to discuss it. He was the first incumbent DA in our county to be voted out of office in over a century when voters rejected him this past November.

Two local reporters, Leslie Berkman of the Press Enterprise, and Chris Bagley or the Californian, were instrumental in keeping this in the public eye. Dozens of the victims banded together in a class action lawsuit. That helped. Our own Real estate Fraud Task Force was born out of this scandal and remains active and vigilant to this day.

So while many of the victims say a 18 year prison sentence is not nearly long enough for the ringleader, it’s at least a start. No punishment can ever rebuild the damage done to our community and no jury award will ever compensate for the retirement savings lost and the lives ruined by these people.

Maybe the lesson to be learned is – if the deal sounds too good to be true…

Of course as we all know, there’s a sucker born every minute and two grifters to fleece him out of his cash.

For the full story, please click below:

Murrieta Men Agree to Prison Time
Victims of Duncan’s Scheme Speak Out


Identity Theft – Careful what you post and where.

SACRAMENTO – A Citrus Heights computer hacker pleaded guilty to seven felony charges for breaking into hundreds of women’s e-mail accounts, the sort of identity theft crime that Californians should take steps to protect themselves against, according to Attorney General Kamala D. Harris.

“This case highlights the fact that anyone with an e-mail account is vulnerable to identity theft,” Attorney General Harris said. “One of the major goals of my office is to track down and prosecute every criminal who would stoop to stealing people’s identities.”

George Samuel Bronk, 23, of Citrus Heights, faces six years in state prison after entering guilty pleas today in Sacramento Superior Court to seven felonies including computer intrusion, false impersonation and possession of child pornography. Bronk will have to register as a sex offender. He will return to court on March 10 for further proceedings relating to his sentence.

From December 2009 through September 2010, Bronk accessed e-mail accounts and Facebook pages of people in 17 states, as well as residents of England. He essentially found answers to the women’s e-mail security questions in information they had posted on their Facebook sites.

Bronk targeted his victims by scanning Facebook for women who also posted their e-mail addresses there. He then contacted the woman’s e-mail service, pretending he was the legitimate customer, and claimed to have forgotten the password. Bronk was able to correctly answer security questions posed by the e-mail service by finding the answers on victims’ Facebook pages.

Some of the security questions posed by e-mail providers included, “What is your high school mascot?” “What is your father’s middle name?” “What is your favorite food?” and “What is your favorite color?”

Once Bronk gained access to the e-mail account, he changed the password and the victim was locked out.

Bronk searched the victim’s “sent mail” folder for nude or semi-nude photographs and videos, which he often sent to the victim’s entire e-mail address book. He also gained access to some victims’ Facebook accounts by clicking the “Forgot Your Password?” link and asking for a new password to be sent to the victim’s e-mail account, which he now controlled. In many cases, he posted the photographs to victims’ Facebook pages and to other Internet sites and made comments on the Facebook sites of friends.

Bronk messaged one victim that he had taken over her e-mail account “because it was funny.” In an online chat session with another victim using the name “xogreeneyesx3,” Bronk demanded the victim send him more explicit photographs or he would post the photographs he already had more widely. The victim complied.

The investigation began after one victim contacted the Connecticut State Police, and the agency then contacted the California Highway Patrol because the suspect appeared to be operating here. The CHP requested the Attorney General’s assistance.

On the hard drive of Bronk’s desktop computer, which was confiscated from his Citrus Heights’ home during a search in September, investigators found more than 170 files containing explicit photographs of women, including a film actress, whose e-mail accounts he had commandeered. Finding victims, however, proved a challenge. CHP and Attorney General agents were able to use location tagging information embedded on the photographs on Bronk’s hard drive to assist in identifying victims, and e-mailed 3,200 questionnaires to potential victims asking them to come forward.

Some 46 victims did, including one who described Bronk’s actions as “virtual rape.”

Bronk was arrested in October and has been held since then on $500,000 bail.

Attorney General Harris reminded users of e-mail and social networking sites that security questions and answers need to be as secure as passwords. There are steps people can take to avoid being victimized by “security question” hacks. These steps include:

-Pick security questions and answers that do not involve any personal information that is available from social networking sites or any other sites.

-Try to switch the security questions you choose for password protection on e-mail services and social networks.

-Add numbers or special characters to your security answers. For example, the question “What was the name of your High School” could be answered “Middle02High@School.”

Joining the Attorney General’s office in this investigation were the Sacramento Valley Hi-Tech Crimes Task Force, the CHP, and the Connecticut State Police. The Attorney General’s office prosecuted the case.

For more information about identity theft, please see http://ag.ca.gov/idtheft/.

The arrest warrant and complaint are attached at the Attorney General’s website www.ag.ca.gov


Long overdue – Stonewood scam goes to trial

At long last the trial has begun for the perpetrators of the so-called Stonewood Scam in Southwest Riverside County. Long time readers are acquainted with the basics of this story from my years-long chronicle of events. Our local association tried to bring this to the attention of law enforcement beginning in late 2004 but were unsuccessful in catching anybody’s ear until the scam had nearly run its course and started to collapse under its own weight.

The real estate part of it consisted of representatives from Stonewood Financial buying homes at significant premiums over asking price. As this was at a time our housing market was appreciating 20% – 30% a year, the fact that someone would pay a 25% or 30% premium on a home purchase was not enough to warrant investigation by the authorities. Homes listed at $500,000 were routinely selling for $600,000 or more. Targeting specific neighborhoods, after the first two or three sales were obtained with fraudulent appraisals, it became a self-feeding scheme since subsequent appraisals were now based on actual sales, albeit fraudulent. Turns out many of the buyers were either made of straw, or people talked into buying multiple properties they couldn’t begin to afford. Naturally other buyers into those neighborhoods also became victims since selling prices became predicated on fraudulently inflated values. In addition to the 200+ documented cases, many more innocent victims lost their homes when prices tumbled by more than 2/3 in some cases.

How did they do it? Well, partially through affinity fraud – many of the buyers were either members of the same ethnicity as the perpetrators or were nurses at the same facility where one of the perpetrators worked. They were also promised that the properties could be rented, that any shortage between the rental income and the mortgage payment would be paid for them, and that the $100,000+ overage collected by Stonewood or a related entity, would be paid to an investment account with the promise of even greater dividends to come.

Naturally there was no investment account to produce income, after a month or two the promised rental offset payments dried up and houses started going into foreclosure by tens, then by hundreds. When we became aware that something smelled bad here, we documented about 60 homes and about $40 million dollars in potential scams. By the time authorities finally acted on it the result was over 200 homes with the perpetrators indicated for over $120 million dollars. Our local District Attorney did not see fit to take action until the SEC, FBI and US Attorneys Office had finally acted, then he stood up on the podium all puffed up taking the credit. I like to hope in some small way it was part of the reason he was soundly defeated in his recent re-election campaign by a relative unknown.

Anyway, in addition to our local real estate fraud task force, reporters Chris Bagley from the Californian and Leslie Berkman from the Press Enterprise payed significant roles in shining the spotlight on these nefarious activities and our own attorney John Giardinelli and an attorney for some of the plaintiffs Richard Ackerman were pivotal in keeping the focus on.

It took too damn long and cost too many people – not to mention the damage done to entire neighborhoods and our cities – but as they say – sometimes the wheels of justice grind slowly. Let’s hope in this case they also grind exceedingly fine.

You can read the whole story and related elements here.

Press Enterprise – Fraud Trail Begins

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The opinions in this commentary are strictly Gene Wunderlich’s personal opinions. While any reasonable and/or rational indivdual should agree wholeheartedly, the opinons reflected herein may not necessarily be those of the Southwest Riverside County AOR,  or any local or state government or other mental institution.

Another Real Estate Scam to beware of.

raspberry

Last week our local paper bestowed their ‘Raspberry’ award to a SoCal based attorney by the name of Michael T. Pines. Pines qualified for this award by virtue of the fact that his business model apparently involves advising clients who have been through foreclosure and been evicted from a home to break back into the home and set up residency. Of the four families he has recently convinced that his advice is sound, he has accompanied them to the house with attendant locksmith and whatever press he can scrounge up.

He garnered a couple headlines.

But most figured it for just what it appears to be – a scam based on the old ‘produce the original document’ scheme combined with his theory that since the bank has foreclosed and the underlying lien has been satisfied by the insurance company, the home has therefore been paid in full and the previous homeowner should be able
to reclaim it and occupy it. Yeah, I know. But he’s preying on unsophisticated and desperate people.

So a couple days ago a judge called him out for filing frivolous lawsuits and slapped him with a $16,000 judgment that he owes one of his clients for wasting their time and money. Today the 2nd family in Escondido who broke into their home to great fanfare a couple weeks ago, was unceremoniously dumped back out by the new owner of the house. According to Emiliano Bolanos, “The people that bought the house, they want to take it again.” DUH

Now here’s something that will surprise you – they haven’t been able to get in touch with Mr. Pines! Yeah, go figure. Mr. Bolanos said he talked to Pines last week and was promised some paper from a judge saying they could stay but the attorney never called back. Another Pines client up in Simi Valley was evicted on Tuesday and was told by the attorney he would be there along with some private security to stop the eviction. He never showed there either. Perhaps it was because Pines had been arrested for vandalism and trespassing a few days before trying the scheme yet again in Newport Beach. (WSJ 10/15/10)

Turns out, according to The Californian, Mr. Pines himself is in bankruptcy. He also has seven of his own properties in foreclosure and lost his own battles to keep his own home by litigating against his lender. Oddly enough, he apparently hasn’t broken back into his own homes – which include properties in Utah, Arkansas and his home and law building in CA. He also has two restraining orders against him in San Diego County for ‘civil harassment after a hearing’. Sounds like a fun guy.

Pines, who has had a law practice for over 30 years, switched to real estate law and investing in 2000. When the market headed south, and with his own personal business apparently tanking, Pines started doing seminars on strategic default, how to use Chapter 11 to your benefit and so forth. It is interesting to note that of the 70 or so cases he claims to represent, he hasn’t won one, including his own. Most real estate attorneys scoff at this sham practice and frown on yet another
‘professional’ victimizing people who have already been cracked once.

Funny thing is – nobody, including Mr. Pines, denies that his clients are deserving of foreclosure. There was no problem with the bank, they either bought way over their head, got caught in some other investment scheme that backfired, or simply ATM’s every nickel out of their home at peak value. Oh, Pines believes that the basic banking model is unsound and fraudulent – but doesn’t deny his clients were all waaaaay behind, several on homes worth a million or more.

Meanwhile, Mr. Bolanos, remember him?. The Bolanos family is now living with the Rochas family, another victim of Pines who referred Pines to Bolanos. Bolanos says “They haven’t called me yet. I’m waiting for their call.” Good luck on that Emiliano. If I were you and he actually does call, I probably wouldn’t take it. Way less trouble for you and your family – although you might get a friendly judge to force Pines to cough up a few more grand for your troubles.

Folks, I know you’re desperate out there but if the deal sounds too good to be true… if it sounds flaky and shaky and full of crap, go with your gut. Chances are you’ll thank yourself later. Unless you’re a professional victim and enjoy it, USE YOUR DAMN HEADS PEOPLE. After all, there’s a sucker born every minute and two grifters to fleece him.

Of course that’s just my opinion, I could be wrong .

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The opinions in this commentary are strictly Gene Wunderlich’s personal opinions. While any reasonable and/or rational indivdual should agree wholeheartedly, the opinons reflected herein may not necessarily be those of the Southwest Riverside County AOR, or any local or state government or other mental institution.


How Can You Lose Something You Never Had To Begin With?

How can you lose something you never had to begin with?

That’s the question that comes to mind when I read the Administrations continuing attack on housing. In Monday’s Wall Street Journal, another front page article states ‘Key Tax Breaks At Risk As Panel Looks At Cuts’. First sentence ‘Sacrosanct tax breaks, including deductions on mortgage interest, remain on the table…’ The article goes on to say ‘…these and other breaks cost the government about $1 trillion a year’. (emphasis mine).

But if the government never had these revenues to begin with, at least in the case of the MID, how can they claim it as a cost? It doesn’t cost them a dime. Wikipedia defines cost thusly: In business, retail, and accounting, a cost is the value of money that has been used up to produce something, and hence is not available for use anymore. Obviously that doesn’t apply here. The government hasn’t ‘produced’ anything of value and has not spent money on it therefore it is not a ‘cost’ to the government.

So the Government chooses to define costs as an economic model (unrelated to actual business, retail or accounting reality) and for their purposes they define it differently: Opportunity cost, also referred to as economic cost is the value of the best alternative that was not chosen in order to pursue the current endeavor—i.e., what could have been accomplished with the resources expended in the undertaking. In theoretical economics, cost used without qualification often means opportunity cost.

So apparently our government functions best in the world of theoretical economics where you can attribute something as a cost even if you produce nothing or spend any actual money on it. It’s not a real cost, it’s a theoretical cost. They could be making more money off us if we would just pay more taxes – so that lost opportunity becomes a cost in their eyes.

California has employed similar theoretical economics for years now – if we don’t increase a department’s budget as much as they requested, it’s called a cut even if they get more than they got last year. And you see where it got California.

The article went on to describe how the President’s Deficit Commission was looking at these ‘opportunities for revenue enhancement’ along with potential cuts in defense spending and a potential freeze on domestic discretionary spending. Hmmm, cut defense but just freeze spending at the current rate? How about this instead? How about making some REAL cuts to the massive spending and stimulus programs that aren’t working for sh**? How about that?  How about cutting the pork & earmarks like you campaignedyou would?

How about getting government out of the housing business and every other business which they are trying to regulate into insolvency and actually let businesses grow again and start creating real jobs instead of government jobs? When it has been proven time and again that a government run ‘business’ i.e. Postal Service, Welfare, Social Security, Fannie & Freddie, are not productive, are not competitive and constantly run at deficits in spite of massive infusions of our money, why would you continue to add more of these albatrosses – like healthcare, the financial regulatory agency, etc? Why is it that the only sector of our economy that has enjoyed robust job growth the past few years has been federal and state government jobs?

I was somewhat mollified to read an AP article a couple days later about the agenda Republicans are devolving, assuming they deliver the sound spanking on Tuesday anticipated by anybody this side of Mars (or Obama).  It involves $100 billion in spending cuts, tax reductions for individuals and businesses to stimulate real growth, and undoing elements of the healthcare program and the overreaching financial regulatory program. I hope they mean it. The attacks on housing have to stop.

Government, which has bloated up beyond all reasonable measure in this country, has exploded the past couple years and now encroaches into every aspect of our personal and business lives. It was  not meant to be so. If we don’t start reducing the role of government soon, we will either lose our Republic and the few remaining freedoms we take for granted today, or at some point we will face a much more volatile upheaval.

Well, Thomas Jefferson said it best when he said that every generation needs a new revolution. Hope and change wasn’t a revolution and has proven to be just more of the same – assuming you define ‘same’ as Chicago ward politics. Maybe this generation will finally stand up for something. You think?

Of course that’s just my opinion – I could be wrong.

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The opinions in this commentary are strictly Gene Wunderlich’s personal opinions. While any reasonable and/or rational indivdual should agree wholeheartedly,
the opinons reflected herein may not necessarily be those of the Southwest Riverside County AOR,  or any local or state government or other mental institution.


Another Mortgage Fraud Scammer Bites the dust.

DOWNEY MAN AGREES TO PLEAD GUILTY IN MULTI-MILLION DOLLAR FRAUD THAT BILKED INVESTORS AND HOMEOWNERS

Juan Rangel Agrees to Serve 15-Year Sentence for Targeting Spanish-Speaking Victims and Stealing Their Savings and Titles to their Homes

LOS ANGELES – A Downey man has agreed to plead guilty to federal fraud and money laundering charges, admitting that he ran two fraudulent operations – a Ponzi scheme that took in $30 million from more than 300 victims and a mortgage fraud scheme that preyed on homeowners by stealing the equity from their homes and secretly taking title to their properties.

Juan Rangel, 46, who is currently in federal custody, signed a plea agreement that was filed late Friday in United States District Court. Rangel agreed to plead guilty to one count of mail fraud and one count of money laundering. In the plea agreement, federal prosecutors and Rangel ask the court to impose a sentence of 15 years in prison.

Rangel agreed to plead guilty to a mail fraud count related to the Ponzi scheme in which Rangel and his company, the Commerce-based Financial Plus Investments, recruited new investors through Spanish-language newspapers and magazines, as well as in radio advertisements and infomercials broadcast on television. Rangel and Financial Plus promised to pay investors guaranteed returns of 60 percent each year out of the profits from Financial Plus’ real estate investments and lending business. However, Rangel admitted in the plea agreement that Financial Plus did not make any actual profits from real estate or lending. Rangel instead used the victims’ money to make Ponzi payments to other investors and for his own personal use, including the monthly mortgage payments on his $3 million home and monthly payments for his Lamborghini sports car.

In the plea agreement, Rangel also admitted that he and others operated a mortgage fraud scheme that targeted Latino homeowners at risk of losing their homes by offering them help to avoid foreclosure. Rather than assisting the distressed homeowners, however, Rangel took titles to their homes and drained the remaining equity out of the properties.  As part of this scheme, Rangel arranged to sell the homeowners’ properties, usually without their knowledge, to third-party straw buyers. He then applied for loans in the straw buyers’ names related to these supposed purchases, and used a variety of falsified documents to ensure that the fraudulent loans were approved. Rangel admitted that the scheme caused mortgage lenders to fund more than $10 million in fraudulent loans.

Rangel is scheduled to plead guilty Wednesday afternoon before United States District Judge S. James Otero. Once he pleads guilty, Rangel will face a statutory maximum sentence of 30 years in federal prison. Although the parties will recommend a sentence of 15 years, Judge Otero will make the final determination as to the appropriate sentence in the case.

A federal grand jury indicted Rangel last month in the Financial Plus schemes. The indictment also charges Javier Juanchi, 42, of Sherman Oaks, a vice president at Financial Plus, and Pablo Araque, 40, of Downey, who owns the Downey-based tax preparation and bookkeeping company A-One Tax Pros. Juanchi and Araque were charged in relation to the mortgage fraud and are currently scheduled to go to trial before Judge Otero on November 23.

The case involving Financial Plus is the result of an investigation by the Federal Bureau of Investigation, the United States Postal Inspection Service and IRS-Criminal Investigation.

CONTACT:        Assistant United States Attorney James A. Bowman

Major Frauds Section