A loan modification scheme targeting Latino customers throughout Southern California has been brought down.
According to prosecutors, the loan modification scheme that cheated Latino consumers out of $400,000, was run by three Orange County family members and two of their business associates.
The Loan Modification Scheme Defendants
Four of the five accused have been taken into custody. The fifth one remains a fugitive. The Orange County District Attorney’s office (OCDA) identifies the defendants as:
* Carlos Jose Centeno, 37, of Yorba Linda. He’s been charged with 121 felony counts of grand theft, one felony count of conspiracy to commit a crime, and five felony counts of unlawful advance fee by a foreclosure consultant. He faces up to 77 years in prison, is being held on $300,000 bail.
* Ricardo Torres Centeno, 31, brother to Carlos Centeno. He has not been located, and has been deemed a “fugitive.” He’s been charged with eight felony counts of grand theft, one felony count each of acts constituting forgery and conspiracy to commit a crime. If captured and convicted, he faces up to 15 years in prison.
* Lizeth Garcia Arzate, 32, wife of Ricardo Centeno. She faces 12 felony counts of grand theft and one felony count each of conspiracy to commit a crime and unlawful advance fee by a foreclosure consultant. She faces 15 years in prison, but has been released on $300,000 bail. She’s due in court on Feb. 20.
* Hector Alfredo Valdivia, 50, of Lake Elsinore, is charged with three felony counts of grand theft, one felony count of conspiracy to commit a crime. He faces eight years and four months in prison if convicted. He was released on $10,000 bail and is due in court on Feb. 20.
* Susie Rabadan, 31, of Anaheim, faces 13 felony counts of grand theft and one felony count each of conspiracy to commit a crime, and unlawful advance fee by a foreclosure consultant. She was released on $10,000 bail and faces 15 years if convicted. Her Feb. 20 court date is pending.
Each defendant also faces sentencing enhancements for aggravated white collar crime over $100,000 under $500,000, taking funds exceeding $50,000 and theft exceeding $150,000. According to the OCDA, all the defendants had to prove the money for their bonds came from legal and legitimate sources.
The Loan Modification Scheme Targeted Latinos
The loan modification scams, which were operated under the business names of “The Foreclosure Prevention Department” and “Debt Settlers of America” (DSA) advertised on Hispanic radio stations throughout the state with claims of being able to help in the renegotiation of home loans.
Collecting Upfront Fees
The defendants have been accused of working together to collect illegal upfront fees for services they never provided while also collecting and processing loan modification applications. The OCDA has collected evidence that shows that between December 2009 and December 2012, the defendants contacted 23 people promising to provide assistance in negotiating their home loans after paying an upfront fee.
Allegedly, some of the collected upfront fees were taken directly from the customers’ monthly mortgage payments and deposited into personal bank accounts. According to the OCDA, the $400,000 obtained from victims was put directly towards the defendants’ own bills and expenses. Meanwhile, many of the victims lost their homes to foreclosure.
Source: OC Weekly, Family Run Loan Modification Scammers Preyed on Latinos Throughout SoCal: OCDA, January 22, 2015