On Monday, Federal officials announced the indictment of 19 people in what they call the largest "foreclosure rescue" scam in the nation. This foreclosure scam allegedly took in more than $12 million and affected more than 100 foreclosure homes.
In Sacramento, the mortgage-fraud case was announced at the federal courthouse where the defendants were charged by a grand jury with mail fraud, money laundering and conspiracy to commit both.
The Sacramento Bee, in February, obtained a search warrant for the case, which victimized homeowners throughout the nation.
The defendants ran an "equity stripping" scams targeting people on the brink of foreclosure, officials with the FBI, IRS and the U.S. Attorney's Office said.
The defendants "made varying misstatements," telling homeowners they could enter a program to repair their credit, refinance their home and keep it, according to the indictment. The indictment also stated the defendants paid straw buyers who took title to the homes and used those people to siphon equity out of the home.
Meanwhile, the homeowners were paying rent to the defendants, believing it would repair their credit. The indictment says after a year or less, the homeowners were left without their homes, equity or repaired credit,.
Charles C. Head, who ran Head Financial Services and several other companies in Costa Mesa, California, was the lead defendant in the case.
The Sacramento Bee reached Head by email in February where he said that allegations and falsehoods were being spread by "a few disgruntled customers."
"It's been over 2 years without a single charge. This has little to nothing to do with me and the FBI and IRS have made no progress on this case at all," Head wrote.
Contributed by MLR Realty
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