Nine Indicted in $6 Million Foreclosure Prevention Scheme in Southern California

Nine people have been indicted in a $6 million scheme that targeted distressed homeowners in Southern California, promising to prevent foreclosure of their properties. California Attorney General Xavier Becerra announced the 136-count indictment, which includes charges of grand theft, identity theft, and conspiracy to commit grand theft.

The defendants, who have pleaded not guilty, are accused of delaying foreclosures and eviction actions by filing fraudulent bankruptcy documents, false court documents, and false fractional interest grant deeds. They allegedly received monthly payments from homeowners, promising to stop the foreclosure process, but many victims still lost their homes despite paying the defendants hundreds of dollars a month over several years.

The scheme impacted over 200 properties, including those with loans insured by the Federal Housing Administration (FHA), Freddie Mac, and Fannie Mae. The U.S. Department of Housing and Urban Development Office of Inspector General (HUD-OIG) emphasized the vulnerability of distressed homeowners and the importance of holding accountable those who prey on them.

The case was the result of a joint investigation by the California Department of Justice, the FHFA-OIG, and the HUD-OIG. Attorney General Becerra vowed to continue working with law enforcement partners to prosecute individuals who exploit vulnerable Californians facing foreclosure.

This indictment serves as a warning to those who engage in fraudulent schemes targeting homeowners in financial distress, as authorities are committed to protecting the public from such exploitation.