Stephen Manning
June 12, 2008 - 6:25 p.m.
GREENBELT, Md. (AP) - Eight people be favored with been indicted in an alleged $35 million mortgage foreclosure rescue scheme to cheat lenders and homeowners facing foreclosure, a case authorities related is likely Maryland's largest mortgage guile case ever.
Federal prosecutors said Thursday that owners of the Metropolitan Money Store targeted homeowners who risked losing their homes and then used stem buyers, fraudulently obtained loans and distended real estate appraisals to strip equity from further than 100 homes in the Washington area. The homeowners seeking help ended up losing whatever money they had invested and their homes.
"They walked away through nothing. No shelter, in no degree credit and no equity," Maryland U.S. Attorney Rod Rosenstein said.
The 25-count indictment unsealed Thursday names Lanham-based Metropolitan Money Store and its president, Joy Jackson, 40, who allegedly used some of the money to pay for a pour out wedding for herself and Kurt Fordham, individual of the other seven indicted.
The charges include conspiracy, mail fraud and money laundering. Prosecutors also seek the return of $35 million in fraudulent loans that the clump allegedly took out from lenders. Each count of the conspiracy carries a greatest amercement of 30 years in prison.
A phone message left notwithstanding an attorney who has represented Jackson during an ongoing civil case brought by homeowners against Metropolitan was not immediately returned Thursday.
Mortgage foreclosure rescue scams, which promise to help struggling homeowners stave off foreclosure and keep their homes, have become a major problem as the protection market continues to fall, according Maryland officials. Unsuspecting owners often sign over their homes and then attain to they are the victims of fraud.
In Maryland alone, mortgage deception cases, including rescue schemes, wish more than quadrupled over the past two years, according to Tom Perez, the state's secretary of labor and licensing.
"The industry was fraught with the potential for corruption," he said.
Maryland investigators began to hear complaints from homeowners about Metropolitan in 2006. According to the indictment, Metropolitan lured in strapped owners through ads on television, radio and in print. The owners were told they didn't qualify for a refinancing of their mortgage, and in return were offered a "Foreclosure Reversal Program."
Under the program, they signed away their title to third parties, but were supposed to realize help from Metropolitan to obtain a more fit mortgage that would allow them to repurchase the home.
Instead, Metropolitan allegedly used the straw buyers, who were paid $10,000 each, to take out big loans adhering the homes using inflated appraisals. They for this reason stripped any equity out of the homes — allegedly $10 million — and allowed the homes to fall into foreclosure.