STATE OF MICHIGAN BILL SCHUETTE ATTORNEY GENERAL. FOR IMMEDIATE RELEASE MEDIA CONTACT: Joy Yearout JULY 23,

Transcription

1 STATE OF MICHIGAN BILL SCHUETTE ATTORNEY GENERAL FOR IMMEDIATE RELEASE MEDIA CONTACT: Joy Yearout JULY 23, Schuette Announces Felony Charges Against Four Southeast MI Individuals, Four Companies in National Federal-State Mortgage Rescue Fraud Sweep A.G. Schuette Files Felony Charges Against Southeast Michigan Mortgage Rescue Fraud Schemes, Announces Conviction of Mortgage Modification Company LANSING - Michigan Attorney General Bill Schuette today announced felony charges against four Southeast Michigan individuals and three companies for operating fraudulent mortgage rescue or loan modification schemes. Schuette also announced the conviction of a New Haven mortgage rescue modification company on charges of violating the Credit Services Protection Act. Many are accused of scamming victims into paying large upfront fees, doing nothing to help them avoid foreclosure, ultimately resulting in victims losing their homes. Foreclosure rescue scam artists attack Michigan families who are fighting to hold on to their homes while already struggling to make ends meet, said Schuette. We will continue to aggressively dismantle these predatory operations, prosecute the criminals behind these schemes, and connect victims with free foreclosure assistance. Several companies and individuals charged are accused of obtaining money through false statements to consumers, a felony punishable by up to five years in prison and/or a $10,000 fine. In addition several are accused of charging upfront fees before services were rendered, a violation of the Credit Services Protection Act. Each of the charges carries a penalty of up to 90 days in jail and/or a fine of $1,000 in addition to the requirement that the companies make full restitution to each of their victims. Charges announced today include: Kyle Gosik, 31, of Ortonville, and David Dziuban, 34, of Plymouth, and Capital Wealth Management, Canton Four felony counts of False Pretenses ($1,000 - $20,000) and seven counts Credit Services Protection Act Violation, 35 th District Court, Wayne County. Capital Wealth Management was managed by Gosik and Dziuban from 2010 to Gosik and Dziuban allegedly instructed staff to use a fraudulent sales script to obtain clients.

2 Schuette Announces Felony Charges Against Four Southeast MI Individuals, Four Companies in National Federal- Page 2 False statements allegedly used by Capital Wealth to entice potential victims include: that they would provide a 100% refund if modification was not obtained within 90 to 120 days; funds paid would be held in trust until the modification was obtained; and that Capital Wealth was licensed by the State of Michigan. Gosik and Dziuban were arrested by Attorney General agents and arraigned today by Judge Lowe in Wayne s 35 th District Court. Bond was set for each at $10,000 personal recognizance. Gosik and Dziuban are next due in court on August 1, 2014 at 8:00 a.m. for a preliminary examination. Rolondo Sage Campbell aka Anthony Carter, 43, of Detroit- One count Felony Uttering and Publishing, one count Felony False Pretenses ($1,000 - $20,000); one count Felony Larceny by Conversion, punishable by up to five years in prison and/or $10,000 fine or three times the money or property, whichever is greater and, one count Credit Services Protection Act Violation, in Livingston s 53 rd District Court. From 2010 to 2011, Campbell is alleged to have operated a mortgage rescue company, E3A, and falsely represented it as a non-profit entity. Campbell is also alleged to have fraudulently submitted a forged legal document to the 53 rd District Court bearing a Howell victim s forged signature from E3A s office, which ultimately resulted in the victim losing her home. Her fees were never returned and neither E3A nor Campbell completed the promised mortgage rescue. Campbell was arrested and arraigned today at 1:30 p.m. in the 53rd District Court in Livingston County before Magistrate Jerry Sherwood. Bond was set at $50,000 cash/surety. His next court appearance is August 29, 2014 at 8:00 a.m. for a preliminary examination before Judge Carol Sue Reader. o Campbell has also been charged with one count Felony False Pretenses ($1,000 - $20,000); one count Felony Larceny by Conversion ($1,000 - $20,000); and, one count Credit Services Protection Act Violation, in Macomb s 41A District Court. Campbell is alleged to have promised a Macomb Township victim he would repair the victim s credit and save the home from foreclosure by arranging a short sale on the home whereby the bank would accept a deed in lieu of foreclosure. The victim lost his home, his fees were never returned and neither E3A nor Campbell completed the promised mortgage rescue.

3 Schuette Announces Felony Charges Against Four Southeast MI Individuals, Companies in National Federal-State Mortgage Rescue Fraud Sweep Page 3 E3A, Detroit One count False Pretenses ($1,000 - $20,000); one count Larceny by Conversion ($1,000 - $20,000); and, one count Credit Services Protection Act Violation, in Livingston s 53 rd District Court. o E3A has also been charged with one count False Pretenses ($1,000 - $20,000); one count Larceny by Conversion; and, one count Credit Services Act Violation, in Macomb s 41A District Court. Yvette Woodruff aka Yvette DeBerry, 50, of Southfield One count Embezzlement $100,000 or more, a 20-year felony and/or a fine up to $50,000 or three times the amount embezzled, whichever is greater; one count False Pretenses ($1,000 - $20,000); and, two counts of Credit Services Protection Act Violation in Oakland s 46 th District Court. From 2010 to 2011, Woodruff is alleged to owned and operated Woodberry Modification Solutions and charged victims upfront fees but provided no mortgage modification services. Woodruff allegedly took money from a victim to discharge his mortgage but converted it to her personal use instead. On July 16, 2014, Attorney General investigators arrested and charged Woodruff. On July 17, 2014, Woodruff was released on a $100,000 personal recognizance bond set by Magistrate Eman Janonie-Damanin Oakland s 46 th District Court. Woodruff was arraigned today and her preliminary examination will be held on September 5 at 9:30 at the 46 th District Court. Woodberry Modification Solutions, Southfield One count Embezzlement $100,000 or more, a 20-year felony and/or a fine up to $50,000 or three times the amount embezzled, whichever is greater; one count False Pretenses ($1,000 or more but less than $20,000); and, two counts of Credit Services Protection Act Violation in Oakland s 46 th District Court. Impact Homeowners, New Haven Six counts Credit Services Protection Act Violation in Macomb s 40 th District Court. Impact contracted to have mortgage rescue and modification services performed through a third party who failed to complete the work. Impact took clients money in advance of any services in violation of the Credit Services Protection Act. On July 20, 2014, a company representative appeared on behalf of Impact for arraignment before Judge Mark Fratarcangeli. Impact pleaded guilty at arraignment to all six charges and must pay restitution in the amount of $75,195 to be dispersed to the 24 Impact victims. Sentencing to be set after 60 days.

4 Schuette Announces Felony Charges Against Four Southeast MI Individuals, Four Companies in National Federal- Page 4 The charges come as the result of Attorney General investigation targeting scam operations that prey on delinquent homeowners or those facing foreclosure and a joint federal-state nationwide sweep performed by the Consumer Financial Protection Bureau and the Federal Trade Commission. To date, Schuette s Corporate Oversight Division and Homeowner Protection Unit together have convicted 39 defendants. Foreclosure Rescue Scam Victim Restitution Fund In August 2013 Schuette announced the launch of a $7.5 million Foreclosure Rescue Scam Victim Restitution fund as a part of the Homeowner Protection Fund monies received by the State of Michigan to resolve the National Mortgage Settlement. This program is intended to provide restitution payments for victims of foreclosure scams who would otherwise never see a penny of court-ordered restitution. To read more about the additional programs under the Homeowner Protection Fund, visit the following link at: For more information on the mortgage settlement, including a consumer alert and a Frequently Asked Questions document available for download on the Attorney General's website: Mortgage Settlement and Homeowner Protection Fund Background The historic $50 billion National Mortgage Settlement followed state and federal investigations, which alleged that five major mortgage servicers routinely signed foreclosure-related documents outside the presence of a notary public and without personal knowledge that the facts contained in the documents were correct. This civil law enforcement action also alleged that the servicers committed widespread errors and abuses in their foreclosure processes. Broad reform of the mortgage servicing process resulted from the settlement, as well as financial relief for borrowers still in their homes through direct loan modification relief, including principal reduction. As of March, 2014, Michigan citizens have received approximately $803 million in benefits from the settlement. The State of Michigan also received a direct payment of $97 million from the servicers. Schuette worked with the legislature and Governor Rick Snyder to establish the Michigan Homeowner Protection Fund to ensure these funds are directed toward victims of foreclosure. On August 1, 2012, Governor Snyder signed legislation creating the $97 Million Homeowner Protection Fund. Defendant last name (Dziuban) pronounced: ZOO-bee-in [Attachments: Defendant photos]

5 Schuette Announces Felony Charges Against Four Southeast MI Individuals, Companies in National Federal-State Mortgage Rescue Fraud Sweep Page 5-30-