Fraud Alert!
Updated: June 20, 2011
California Penal Code on Forgery -- Check your Deed or Mortgage Assignments!
Deed Fraud Scheme!
June 18, 2011
MURRIETA, Calif. (WREL) -- A family is being told the house they thought they bought in Murrieta actually belongs to someone else. The family says they can't stop making their mortgage payments. That was hardly the feeling last summer where there was all the euphoria of buying their first home.
"Even though you've made your payments in full every month, you could get a knock at the door saying get out," said would-be homeowner Charlie Zahari. "If you look at it, we're renters in a house we can't move out of."
They custom painted the girls' bedrooms and sodded the backyard. They stopped making improvements when they found out they're not the legal owners of the home. "We actually got a call from the FBI who said we just wanted to inform you that your house has been part of a deed fraud scheme," Zahari said.
Karen Tappert is the person the Zahari's say is responsible for stealing the home and selling it to them. She's facing federal charges, but that does little to help the Zahari's with their situation. They must continue paying for the home or otherwise put their credit at risk. They can also be forced to vacate at any moment. Tappert's federal trial is under way in Nevada.
Officials said it started when the original owners of the property vacated the house because they thought the bank was going to foreclose on them. That never happened, and the alleged scam artists swooped in and fraudulently sold it to the Zaharis.
The family said neither the title company, First American Title Insurance, nor the bank have done much to help answer how the title company allowed the purchase of the home in the first place.
In a statement, First American said, "For privacy reasons we cannot comment on the specifics of Mr. & Mrs. Zahari's claim, however, generally the process of establishing title involves other necessary parties and is dependent on their cooperation. This process can be time consuming and complicated." Bank of America also said they're a victim too and they're working with the title company for a resolution.
Civil Fraud
June 17, 2011
U.S. regulators could file civil fraud charges against some credit rating agencies, and settle with more Wall Street banks, for their role in developing mortgage-bond deals that helped trigger the financial crisis, the Wall Street Journal reported, citing people familiar with the matter.
The inquiry into the rating agencies broadens the U.S. Securities and Exchange Commission's (SEC) probe into the sales and marketing of mortgage-bond deals by several financial firms, the paper said.
It said other firms being probed by the SEC include JP Morgan, Citigroup, Morgan Stanley, Bank of America's Merrill unit and UBS AG.
The SEC was also reviewing the conduct of McGraw Hill's Standard & Poor's, and Moody's Investors Service, owned by Moody's Corp, on at least two mortgage-bond deals, the paper said.
JP Morgan is expected to settle within weeks allegations related to its sale of a $1.1 billion mortgage-bond investment as the market collapsed in early 2007, the paper said.
JP Morgan declined to comment to media sources on any settlement of the collateralized debt obligations (CDOs).
Mortgage-backed securities and CDOs were at the heart of the financial crisis. Wall Street banks vacuumed up home loans, often subprime mortgages, and repackaged them into bonds and other securities that were sold with top-notch credit ratings.
When the U.S. housing market crashed, the securities plummeted in value, generating enormous losses for investors around the world.
Last year, Goldman Sachs settled civil fraud charges with the SEC for about $550 million regarding its role in marketing a subprime mortgage product.
The Journal said JP Morgan and most other banks facing fraud allegations are expected to agree to pay about half or less than the $550 million paid by Goldman.
The paper said a Standard & Poor's spokeswoman declined to comment, and it quoted Michael Adler, a spokesman for Moody's, as saying: "Although Moody's is uncertain as to what The Wall Street Journal is referring, we would certainly cooperate with any requests we receive from the SEC."
Media sources could not immediately reach Standard & Poor's or Moody's for comment. The SEC declined to comment.
The SEC is considering whether the credit ratings firms failed to do enough research to be able to rate adequately the pools of subprime mortgages and other loans that underpinned the mortgage-bond deals, the paper said.
The SEC last month sought public comment on proposals that the credit rating agencies needed to reveal more about how they judge financial products and how those ratings perform over time.
Fraud
April 28, 2008
NEW YORK — Reported incidents of mortgage fraud jumped 42 percent nationwide, with Florida reporting the highest number of cases, according to industry data released Monday.
Properties in the Sunshine State accounted for nearly a quarter of all mortgage fraud incidents, the Mortgage Asset Research Institute said. California ranked second, followed by a three-way tie for third among Illinois, Maryland and Michigan.
The report is based on data submitted by MARI subscribers about loans that were originated in the first quarter of this year and have since been classified as fraudulent.
The most common mortgage fraud cases included misrepresenting income, employment history, and debt and assets. Maryland, for example, had an unusually high percentage — 69 percent — of its cases involved tax return and financial statement misrepresentation.
Mortgage fraud has represented about $1 billion in losses over the past decade, the Mortgage Bankers Association has said.
The increase in reported incidents comes as lenders raise credit standards to curb rising foreclosures. Critics charge the industry for being too lax in qualifying risky borrowers during the boom, which fueled an overheated housing market.
But the stricter requirements have done little to curb fraud.
"Tightening credit standards by itself doesn't eliminate fraud," said Merle Sharick, vice president and national manager of business development for MARI, especially in markets that typically attract a lot of speculators like Florida and California.
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