CONSUMER FINANCIAL PROTECTION BUREAU ORDERS 1 st ALLIANCE LENDING, LLC OF CONNECTICUT PURSUANT TO A CONSENT DECREE TO PAY PENALTY FOR RESPA KICKBACK

Transcription

1 MORTGAGE e-alert Page 1 of 10 (14-3-1a) Please add thor.law@lendinglaw.com to your address book. This will ensure delivery into your inbox and not your junk, spam or bulk e mail box We have a manual that defines CFPB definition of who is a loan originator which includes real estate listing and selling brokers in real estate sales, compensation, bonuses, reasons for bonuses, amounts allowed, prohibited compensation, Ability to Repay on Qualified Mortgages, High Priced and Higher Priced Mortgages Mortgage Servicer. The cost is $135. This will assist you with compliance issues. If you would like the 23 page summary of the 243 page law, you may call , or fax your information to or me at h.thordsen@lendinglaw.com WE HAVE UPDATED THE SAFEGUARDING PRIVACY MANUAL AND IDENTITY THEFT MANUALS. IF YOU WOULD LIKE TO ORDER THEM THE COST IS $225 PER MANUAL. ADDITIONALLY, YOU ARE REQUIRED TO HAVE AN ANTI-MONEY LAUNDERING MANUAL THESE ARE ALL FEDERAL REQUIREMENTS If you require mortgage loan officer contracts in compliance with the Consumer Financial Protection Law as amended contact Sean Thordsen. CONSUMER FINANCIAL PROTECTION BUREAU ORDERS 1 st ALLIANCE LENDING, LLC OF CONNECTICUT PURSUANT TO A CONSENT DECREE TO PAY PENALTY FOR RESPA KICKBACK On February 24, 2014 the CONSUMER FINANCIAL PROTECTION BUREAU ORDERED A CONNECTICUT MORTGAGE LENDER, 1ST ALLIANCE LENDING, LLC (FIRST ALLIANCE), TO PAY AN $83,000 CIVIL MONEY PENALTY FOR VIOLATING FEDERAL LAW BY ILLEGALLY SPLITTING REAL ESTATE SETTLEMENT FEES. First Alliance selfreported these violations to the Bureau, admitted liability, and provided information related to the conduct of other actors that has facilitated other enforcement investigations. Director Cordray stated the CFPB will continue to take into account the self-reporting and cooperation of companies in determining how to resolve such matters. First Alliance is a mortgage lender in East Hartford, Conn. that focuses primarily on providing lossmitigation financing to distressed borrowers. First Alliance obtains troubled mortgages from mortgage servicers, and reaches out to consumers to offer them new loans with reduced principal amounts under federally related mortgage programs. First Alliance started using a hedge fund to finance its loans in Under this arrangement, First Alliance split revenues and fees with affiliates of the hedge fund. In 2011, First Alliance secured less

2 costly financing and ended its arrangement with the hedge fund and its affiliates. Although the hedge fund and its affiliates no longer financed First Alliance s mortgages, First Alliance continued to split origination and loss-mitigation fees with them. The hedge-fund affiliates received payments from 83 First Alliance loans made between August 2011 and April In 2013, First Alliance reported to the Bureau that it believed it had violated the Real Estate Settlement Procedures Act (RESPA) by paying these unearned fees. RESPA bans a person from paying or receiving a portion or split of a fee that has not been earned in connection with a real estate settlement. First Alliance cooperated with the Bureau s investigation, and the Bureau concluded that First Alliance s payments to the hedge fund and its affiliates had violated RESPA. First Alliance s selfreporting and cooperation, consistent with the Bureau s Responsible Business Conduct bulletin published on June 25, 2013, were taken into account in resolving this matter. Under the terms of the consent order, First Alliance is required to pay a civil money penalty of $83,000 to the Bureau and agrees not to violate RESPA in the future. The Bureau will continue to enforce RESPA s provisions to protect consumers and to deter unlawful activity. (cfpb22714) 1 st Alliance apparently gave leads to CFPB of others violating RESPA. I wonder if they would like us to represent them. Especially since they should know who they are in relation to 1 st Alliance. IN CALIFORNIA YOU CANNOT LEGALLY TALK ON YOUR MOBILE PHONE WITHOUT A HANDS FREE BLUETOOTH- YOU CANNOT LEGALLY TEXT ON YOUR MOBILE PHONE BUT YOU CAN READ A MAP ON YOUR MOBILE PHONE AND IT DOES NOT VIOLATE CALIFORNIA LAW On February 27, 2014 a California State Appeals Court held that drivers in California can legally read a map on their hand-held cell phones while behind the wheel,. The 5th District Court of Appeal REVERSED THE CASE OF A FRESNO MAN WHO WAS TICKETED IN JANUARY 2012 FOR LOOKING AT A MAP ON HIS IPHONE 4 WHILE STUCK IN TRAFFIC. THE DRIVER, STEVEN SPRIGGS, challenged the $165 fine. But Spriggs said he's no champion of those who think they can get away with cruising down the road while staring at their phone or engaging in other such dangerous behavior. Spriggs would like the law that ensnared him to be rewritten so officers can do their job unencumbered. We're distracted all the time, he said. If our distractions cause us to drive erratically, we should be arrested for driving erratically. Page 2 of 10

3 It's personal for Spriggs, whose son suffered a broken leg from a driver who was chatting on a cell phone. Spriggs said he uses a hands-free device to talk and drive. The incident that ensnared Spriggs happened when he was stopped by roadwork. He had grabbed his cell phone to find an alternate route when a California Highway Patrol officer on a motorcycle spotted him and wrote the ticket. Spriggs first challenged the case in traffic court, where he lost, and then appealed it himself to a three-judge panel in Fresno County Superior Court, where he lost a second time. Determined that the law didn't apply to him, Spriggs took it to the appellate court, but this time with help of a law firm that stepped in to represent him pro bono. In their 18-page ruling, the appellate judges said CALIFORNIA'S LAW THAT PROHIBITS PEOPLE FROM TALKING ON THEIR CELL PHONES WITHOUT A HANDS-FREE DEVICE COULD HAVE BEEN WRITTEN MORE CLEARLY, BUT IT DOESN'T APPLY TO LOOKING AT MAPS ON CELL PHONES. THE LAW THE CHP OFFICER USED TO TICKET SPRIGGS APPLIES SPECIFICALLY TO PEOPLE LISTENING AND TALKING ON CELL PHONES, not using their mobile phone in other ways, the court said. Texting while driving remains illegal under another California law passed after the one at issue in Spriggs' case. Spriggs, who is entitled to recoup his $165 fine, said the Superior Court judges who had upheld his violation were guilty of overreaching by applying the spotty law to him. (ocreg22714) Page 3 of 10 I now can read my IPhone in traffic? Boy that should increase the rear-enders. If you get hit, call me. It is still negligence and you can still recover damages. Thanks to Lloyd Matthews for bringing this to my attention. BAKERSFIELD, CALIFORNIA SEES CARL COLE GET 17½ YEARS IN FEDERAL PRISON FOR MORTGAGE FRAUD On February 24, 2014 CARL COLE WAS SENTENCED TO 17 1/2 YEARS IN FEDERAL PRISON for his role in a $30 million mortgage fraud scheme in Bakersfield. Cole had previously pleaded guilty to conspiracy to commit mail fraud, wire fraud and bank fraud. After his sentencing he was immediately taken into custody. On the same day HIS SON, CALEB, WAS SENTENCED TO SIX MONTHS IN PRISON AFTER HAVING PLEADED GUILTY TO MAIL FRAUD. Caleb Cole will not have to report to prison until April 21. (bkrsfldcas22414)

4 And so ends a saga that has been going on for over 6 years since the investigation began. OXNARD, CALIFORNIA WOMAN GOES TO JAIL FOR MORTGAGE FRAUD On February 27, 2014 GLORIA BECERRA, 48 of OXNARD, CALIFORNIA was sentenced to a year in jail after pleading guilty to charges of felony fraud, grand theft and recording a false document. She (in my opinion) had a sharp attorney when she paid $60,000 in restitution BEFORE BEING SENTENCED which will be given to the victims. That goes a long way with a Judge when the Judge is considering how long a person should stay in custody. GLORIA BECERRA, 48, WAS A LOCAL REPRESENTATIVE FOR A HOME LOAN MODIFICATION AND FORECLOSURE RESCUE BUSINESS CALLED SUNSET BEACH MANAGEMENT. Law enforcement shut down the operation in 2010 but Becerra continued to operate under other business names, including FINANCIAL WELLNESS FOR HOMEOWNERS L.A., CALIFORNIA SKY PREMIER, SUNRISE FINANCIAL I, DREAM CARE HOLDING AND SECURED ASSETS GROUP LLC. Becerra pleaded guilty to five counts of felony grand theft, two counts of felony foreclosure consultant fraud and one felony count of recording a false instrument. She also admitted to a special allegation of taking money in excess of $65,000. Becerra collected about $78,000 in illegal upfront fees from victims and promised to reduce their mortgage loans and "save" their homes from foreclosure. (vntrastr22714) As I said the prosecutors are still pursuing fraudulent mortgage loans that funded as long as ten years ago. Here it was loan modification. Remember fraud includes NINA and SISA loans. If a loan officer did not get some validation and in fact had REASON TO KNOW the information was fraud they to can be and have been prosecuted. Offhand it would appear Ms. Becerra had a good attorney since she was only sentenced to one year. In the federal system it could have been a lot longer. Both state and federal agencies are still pursuing mortgage fraud and loan modification cases very aggressively because of the meltdown and in this lawyer s opinion Page 4 of 10

5 SEVEN ARRESTED IN SAN BERNARDINO COUNTY, CALIFORNIA FOR LOAN MODIFICATION FRAUD-FACE UP TO 8 AND 12 YEARS IN PRISON IF CONVICTED On February 26, 2014 seven suspects were arrested and have been charged in a mortgage fraud scheme that defrauded more than 1,550 Inland Valley homeowners seeking loan modification services during California s foreclosure crisis. The felony complaint alleges that NEHAD NICK AYYOUB AYYOUB, 57, OF SAN BERNARDINO and president of THE FIRM LOANS, INSURANCE AND INVESTMENTS INC. and FIRST CHOICE DEBT SOLUTIONS INC., along with his six colleagues, GHYDAN AYYOUB RABADI, 38, OF LOS ANGELES, ZAID RABADI, 49, OF LOS ANGELES, JAMES CLEMONS, 55, OF RIVERSIDE COUNTY, WISSAM ISMAIL, 32, OF RIVERSIDE COUNTY, EDDIE MERCADO, 57, OF SAN BERNARDINO, AND MAJID SAFAIE, 60, OF ORANGE COUNTY, deceived homeowners by illegally charging up-front payments for loan modification services and lying about the services they provided. The suspects are charged in a 24 count complaint of felony grand theft, personal and corporate income tax evasion and conspiracy. The suspects were booked at Murrieta Detention Center, Orange County Jail, Rancho Cucamonga Jail and Azusa Police Department. Ayyoub is being held with bail set at $75,000 and all others are being held with bail set at $50,000. Ayyoub is facing a maximum exposure of 12 years in prison while his colleagues are facing a maximum exposure of 8 years in prison. According to court filings, Ayyoub and his colleagues took advantage of homeowners who were desperate to lower their mortgage payments by selling them home loan modification services and requiring payment of up-front fees. Homeowners were falsely told that attorneys would be negotiating their loan modifications, that they would get a loan modification with no risk of failure, that they would receive a refund if they were dissatisfied and that the suspects had special contacts with lenders, which would give them an advantage in obtaining lowered monthly payments. Homeowners were instructed to stop paying their mortgage and to instead give the money to Ayyoub and his colleagues to ensure that they would obtain a loan modification, causing many victims to default on their home loans without obtaining a modification, according to court filings. The suspects operated this scam from January 2007 to March 2010, according to court filings. Homeowners who feel they may have been victimized should file an online complaint with the California Attorney General s Office: (CALAG22614) 1. They are all innocent until proven guilty. 2. The state is going back 7 years so if anyone reading this was involved in a Loan Modification company since 2007, I would suggest they see their attorney now or call me. Page 5 of 10

6 NEW JERSEY REAL ESTATE CONSULTANT GETS 20 MONTHS IN FEDERAL PRISON FOR MORTGAGE FRAUD On February 21, 2014 WILLIAM BARKSDALE, 47, OF BURLINGTON, NEW JERSEY a real estate consultant was sentenced today to 20 months in prison for helping five people defraud banks by obtaining multiple home equity loans on the same property. BARKSDALE WAS THE OWNER OF BARKSDALE BUSINESS GROUP, BARKSDALE INVESTMENT PROPERTIES, AND BARKSDALE LOAN CONSULTANTS. He devised a scheme to obtain multiple home equity lines of credit on a single home for more than the property was worth. A homeowner would submit loan applications to several lenders simultaneously without advising each lender about the other applications. Any bank conducting a title search would receive a clean title report because the other home equity lines of credit had not yet been recorded. Barksdale advised five people to secure multiple home equity loans using his scheme, and each obtained at least three home equity loans on a single property. One individual obtained seven home equity loans on one home. Each person paid Barksdale a portion of the fraudulent proceeds. Many of the home equity loans later went into default. The scheme caused more than $1 million in losses. In addition to the prison term, Judge Kugler sentenced Barksdale to five years of supervised release. (usattynj22114) It always leaves a paper trail that is easy for the FBI to follow. As I have stated many times before any one even remotely involved with mortgage fraud, should see their attorney now. The attorney, based upon the facts (which are privileged and which the attorney cannot be forced to disclose on pain of risking loss of license) can advise anyone on possible scenarios and outcomes, Knowledge lets a person sleep better. Lack of knowledge causes anxiety. If anyone has been involved even remotely, see your attorney now. If you do not have one you can consult with me. NORTH TEXAS WOMAN PLEADS GUILTY TO MORTGAGE FRAUD AND FIVE CO-CONSPIRATORS ALREADY SENTENCED TO LONG TERMS On February 26, 2014, LACIE DEVINE a 35-year-old Edinburg, Texas woman pleaded guilty to federal charges in connection with a mortgage fraud scheme in the Eastern District of Texas. Lacie Devine pleaded guilty to conspiracy to commit mail fraud. She is the remaining defendant associated with five others in the same conspiracy to plead guilty to the mortgage fraud scheme. She faces up to 20 years in federal prison, Page 6 of 10

7 From March 2008 through February 2010, Devine, an ESCROW OFFICER AT NATIONAL ESCROW & TITLE LCC, LOCATED ON NORTH DALLAS PARKWAY IN DALLAS, conspired with others, including the five individuals identified below, to defraud lending institutions by submitting false documentation in support of mortgage applications on 28 property transactions located in the Dallas/Fort Worth Metroplex. Specifically, Devine created fraudulent HUD-1 documents for each transaction that falsely stated the source of the down payments and concealed the true nature of the loan fund disbursements from the lending institutions. Devine s criminal conduct in the scheme resulted in a loss to lending institutions of approximately $3,718, Devine was indicted by a federal grand jury on June 13, 2013 and charged with federal violations. The five co-conspirators, all charged in separate indictments, have also pleaded guilty and been sentenced for their roles in the mortgage fraud conspiracy: - ROSLYN LONG, 45-YEAR-OLD LOAN OFFICER FROM PLANO, TEXAS, SENTENCED TO 97 MONTHS IN FEDERAL PRISON and $3,492, in restitution; - MICHAEL ROSS, 36-YEAR-OLD LOAN OFFICER AND COORDINATOR FROM DALLAS, TEXAS, SENTENCED TO 63 MONTHS IN FEDERAL PRISON and $3,337, in restitution - CURTIS CALLIER, 33-YEAR-OLD RECRUITER FROM DESOTO, TEXAS, SENTENCED TO 30 MONTHS IN FEDERAL PRISON and restitution in the amount of $691, RONZELL MITCHELL, 37-YEAR-OLD RECRUITER FROM STROUDSBURG, PENNSYLVANIA, SENTENCED TO 46 MONTHS IN FEDERAL PRISON and $1,408, in restitution; - CHRISTI WYATT, 42-YEAR-OLD RECRUITER FROM DESOTO, TEXAS, SENTENCED TO 37 MONTHS IN FEDERAL PRISON and restitution in the amount of $1,032, (usattedtxy22614) If you have been reading the e alerts religiously, you will find that prosecution of mortgage fraud has not let up but has increased dramatically on all frauds that occurred in last ten years. If you have questions about the prosecutions, how they are picked, what are parameters and would like to know these statistics that are public record, call me. THE INFORMATION CONTAINED HEREIN IS NOT LEGAL ADVICE. AN ATTORNEY SHOULD BE CONSULTED IF YOU DESIRE LEGAL ADVICE Page 7 of 10

8 SPEAKERS AND SPEAKING ENGAGEMENTS DATE: TUESDAY, APRIL 15, 2014 TIME: LOCATION: TOPIC: 9:00 A.M. 12:00 P.M. SACRAMENTO ASSOCIATION OF REALTORS BUREAU OF REAL ESTATE AUDITS- HOW YOU ARE CHOSEN FOR AN AUDIT, HOW THEY ARE CONDUCTED AND WHAT CAN CAUSE THEM. HOW TO AVOID SOME OF THEM. TECHNOLOGY SOLUTIONS TO HELP MANAGE COMPLIANCE AND RISK SPONSORED BY: GREATER SACRAMENTO CHAPTER - CAMP SPEAKERS: HERMAN THORDSEN, ATTORNEY AT LAW GINGER BELL, C3 COMPLIANCE SOLUTIONS COST: $15 members, $25 non-members, $10 more at the door, FREE if you join CAMP, Greater Sacramento Chapter The Thordsen Law Firm for over 40 years represents clients in business litigation, personal injury, trusts, wills and administrative hearings among other matters. Mr. Thordsen is a highly respected attorney representing clients before the California Bureau of Real Estate, and in court proceedings. The firm conducts pre-audits for compliance with state and federal laws and regulations and defends those accused of mortgage fraud as well as those sued or threatened with lawsuits by investors for losses or buybacks of mortgage loans. Those under investigation or charged with mortgage fraud either criminally or civilly with buyback demands have generally been satisfied with our results. We develop agreements and advise companies on the new contract requirements for mortgage loan originators effective January 1, 2014 as well as audit procedures and policies to avoid violation of CFPB, BRE, HUD/FHA and state agency licensing laws and regulations and mortgage fraud laws. The firm attorneys represent numerous clients in many areas of law including Personal Injury, trusts and wills, criminal white collar defense, and administrative actions copyright and trademark protection, bankruptcy and defending civil lawsuits as well as well as general real estate matters. Among others we are counsel to lenders, realtors, mortgage brokers in California and nationally. We are counsel to state trade associations in California, Nevada and Arizona. Page 8 of 10

9 If we may serve you please contact one of our attorneys at: Page 9 of Kalmus Drive, Suite B-250 Costa Mesa, CA (888) Herman Thordsen, Esq. Jozef G. Magyar, Esq. Sean Thordsen, Esq. IN A CAR ACCIDENT? Our trial lawyer is Alan Brown a member of the National Trial Lawyers Association and past president of the Orange County Trial Lawyers Association. The National Trial Lawyers of America is by invitation only to the 100 top trial lawyers in each state. We are quite proud of Alan s accomplishment and the fact that we may serve those of you that have been injured so that you receive just compensation for your injuries. Recently he has settled two or our cases for the policy limits. Perhaps we can assist you. TOO MANY CREDITORS BOTHERING YOU? Bankruptcy can potentially stop a fraud judgment from being entered against you thus reducing the risk of a non dischargeable judgment being entered against you and the risk of losing a professional license. If a foreclosure occurred the lenders on the junior mortgages have the right to sue when it is a non purchase money mortgage but there are certain exceptions. The lenders can sue on the junior mortgages as unsecured promissory notes and they are doing just that. The bankruptcy can prevent or stop this lawsuit. Bankruptcy is a form of asset protection, believe it or not. It can in certain circumstances protect OVER $175,000 and more. A Chapter 13 bankruptcy may be able to remove that second and even third mortgage by stripping it down as an unsecured lien and paying a percentage of the amount potentially allowing you to save the home. Under certain circumstances you may be able to legally keep one or more of your credit cards after the bankruptcy so you have something to reestablish credit and to use when traveling. DISCLOSURE The services or benefits with respect to bankruptcy relief are under Title 11 of the United States Code. In doing this: We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code within the meaning of Title 11 United States Code Section 528.

10 IF YOU WOULD LIKE TO SUBSCRIBE TO THE MORTGAGE E ALERT AT NO COST PLEASE SUBMIT THE FOLLOWING INFORMATION to Or By FAX: OR CONTACT US AT NAME: COMPANY: ADDRESS: CITY, STATE, ZIP CODE: TELEPHONE: If you do not desire to receive any further e mails from our firm please reply with the word UNSUBSCRIBE and you will be deleted from our e mail for all purposes. To ensure compliance with requirements imposed by the IRS, informs you that, if any advice concerning one or more U.S. Federal tax issues is contained in this communication (including any attachments), such advice is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein Page 10 of 10