In a Press Release the US DOJ in Los Angeles announced that as the result of an investigation by the FBI two individuals operating real estate and escrow agencies in Downey and Seal Beach were arrested this morning for allegedly victimizing dozens of homeowners through misrepresentations and fraudulent transactions, and eventually robbing them of the equity in their homes.
Click here to see the District Court Docket (Indictment not yet available)
In an indictment filed yesterday in United States District Court in Los Angeles, Martha Rodriguez and Edward Seung Ok were charged with 10 counts of mail fraud by operating a foreclosure scheme that targeted commercial lenders and homeowners in the cities of Lakewood, Wilmington, Carson, West Covina, La Puente, El Monte, Wilmington, Downey, Los Angeles and Asuza. The scheme allegedly caused losses of at least $8 million.
According to the indictment, the defendants would locate homeowners whose loans were in default by scouring databases that list pending foreclosure sales. The defendants would then pay others to visit the identified homeowners and convince them they could avoid forfeiture of their homes. When homeowners expressed interest, Rodriguez and Ok would meet with them and tell the homeowners that they could stop the foreclosure of their homes. Rodriguez and Ok explained that they would provide short-term loans to cover their debts. The victims were told that their homes would eventually be refinanced by "co-signers" with good credit, and that would help the homeowner qualify for a new loan. The defendants promised the homeowners that their credit would be improved within a period of 6 to 12 months.
The indictment further alleges that homeowners were asked by the defendants to sign various documents including loan applications, trust and grant deeds, while being assured they would not lose title to their homes. The defendants promised the deed would either be held in escrow or that the title would be returned to them once their credit was fixed.
The defendants continued the scheme by applying for loans, in some cases using straw buyers, who never intended to reside in the home. The straw buyers were paid a fee of up to $5,000. The loan applications included information relating to their income, bank account and employment. In other cases, the defendants would submit applications using the information and forged signatures of past clients, without their knowledge. The defendants would instruct the banks to wire the loan proceeds directly to their escrow accounts, and only a small portion of the loan proceeds would go to the homeowner. The majority of the loan proceeds would go to Rodriguez and her family members, Ok, and other unindicted co-schemers, according to the indictment.
Rodriguez, 33, was taken into custody at her Downey residence this morning. Ok, 39, of Torrance, was arrested simultaneously at a probation office in Arcadia. Both are scheduled to make their initial appearances this afternoon in federal court in Los Angeles. If convicted on all counts of the indictment, Rodriguez and Ok each face a maximum possible penalty of 200 years in prison.