Who is Elham Assadi Jouzani?

Last March, we wrote about the federal indictment of 19 people for mortgage fraud-related offenses under what the government called “Operation Homewrecker.”

The indictment alleged that a scam operated by Charles Head, 33, of Los Angeles, California, along with 18 others under his direction, targeted homeowners in dire financial straits, and fraudulently obtained title to over 100 homes and stole millions of dollars through fraudulently obtained loans and mortgages.

Among the alleged conspirators was Elham Assadi, aka Elham Assadi Jouzani, aka Ely Assadi, 30, of Irvine, California.

In the past two weeks, many of our readers have found this blog by searching for the name Elham Assadi Jouzani (and, somewhat less frequently, by searching for Ely Assadi and Elham Assadi).

Who is Elham Assadi Jouzani?

Jouzani is alleged by federal prosecutors to have been part of a “foreclosure rescue” scam that netted approximately $6.7 million in fraudulently obtained funds taken from 47 homeowners, nearly all located in California.

The allegations are that from January 1, 2004 to March 14, 2006, the defendants contacted desperate homeowners, offering two “options” allowing them to avoid foreclosure and obtain thousands of dollars up-front to help pay mounting bills. If the homeowner could not qualify for the “ first option,” which virtually none could, they would be offered the “second option.” An “investor” would be added to the title of the home, to whom the homeowner would make a “rental” payment of an amount allegedly less than their mortgage payment, thereby allowing the homeowner to repair their credit by having the mortgage payments made in a timely fashion.

All of this was a scam.

The defendants recruited straw buyers as the “investors” who would then replace the homeowners on the titles of the properties without the homeowners’ knowledge. Once the straw buyer had title to the home, the defendants immediately applied for a mortgage to extract the maximum available equity from the home. The defendants would then share the proceeds of the ill-gotten equity and “rent” being paid by the victim homeowner.

When the defendants ultimately would sell the home, stop making the mortgage payment, and/or pursue an eviction proceeding, the victim homeowner was left without their home, equity, or credit.

These facts explain the interest in Operation Homewrecker.

But these facts don’t explain the recent particular interest in Jouzani.

We’ve searched the Internet ourselves, and we can’t find any reference to Elham Assadi, Ely Assadi, or Elham Assadi Jouzani outside of this case.

Nor can we find anything in the news that explains the current interest in Jouzani as compared to the other Operation Homewrecker conspirators.

If you’ve come to this blog by searching for Jouzani, please tell us why there is so much special interest in this particular Homewrecker.

And why the interest at this time?

We’d love to provide more reporting on Jouzani, so if you know something, please tell us so that we can pass it on to our readers.

 

One of Charles Head’s “Operation Homewrecker” Scammers Still Listed as Broker on Reverse Mortgage Website

Keith Brotemarkle, one of the people indicted with Charles Head in an alleged “equity stripping” scheme called Operation Homewrecker, was also involved in a reverse mortgage company called Reverse Mortgage Resources.

The company’s website “invites qualified brokers to become Approved Reverse Mortgage Advisors” with Reverse Mortgage Resources.  It asks potential affiliated brokers ” Who did you speak with at Reverse Mortgage Resources?” 

One of the brokers listed as being at Reverse Mortgage Resources is Keith Brotemarkle.

Brotemarkle was allegedly a participant in Charles Head’s “equity stripping” scheme that netted approximately $5.9 million in stolen equity from 68 homeowners in states across the nation. Targeting distressed homeowners and defrauding mortgage lenders through the use of straw buyers, Head would receive approximately 97 percent of the stolen equity, while the other defendants received either the remaining 3 percent of equity or a salary from the fraudulently-obtained funding. The defendants used referrals from mortgage brokers to identify and solicit new victim homeowners, and also sent “blast faxes” to mortgage brokers throughout the country and mass emails to potential victims. Through misrepresentations and omissions, desperate homeowners would be offered what appeared to be their last best chance to save their homes. Victims were left without their homes, equity, or credit.

The FBI has recently announced that it has begun an investigation to the misuse of reverse mortgages.  Reverse mortgages release the equity in a property to the homeowner in one lump sum or multiple payments. The homeowner’s obligation to repay the loan is deferred until the owner dies, the home is sold, or the owner leaves the home.  In the U.S., reverse mortgages are available for people 62 years old or older. Reverse mortgages are typically used to finance retirement or pay unexpected medical bills.  While reverse mortgages can make sense for seniors, the FBI is concerned about possible abusive sales practices that prey on seniors, such as aggressive and untruthful marketing and excessive fees.

Reverse Mortgage Resources is run by mortgage broker Don Marginson.  Its website states that it is located in Ranch Bernardo, California, and that it is “expanding again with offices to cover the Southeast and Northeast United States.”

We have no reason to believe that Reverse Mortgage Resources is not legitimate, and we would not want to assume that it is illegitimate simply because of its association with Brotemarkle.

But we would suggest that they remove Brotemarkle’s name from its website.

 

 

Mortgage Fraud Scammers Plead Guilty in US Foreclosure Capitol

Stockton, California, has been hit harder by the subprime mortgage crisis than any other US city. 

With a population of just over 280,000, Stockton had 22,000 foreclosure filings in 2007 (1 in 27 households), the highest foreclosure rate of any city in America. 

And as home prices continue to fall, the foreclosure crisis in Stockton is getting worse.

Stockton was an agricultural community, the seat of San Joaquin County, the fifth largest agricultural county in the United States and one of the most productive agricultural regions in the world.  In the past decade, however, Stockton experienced a population boom due to thousands of people settling in the area to escape the higher cost of living in San Francisco and Sacramento. 

Although the median income for a household in Stockton was only $35,453, the per capita income for the city was only $15,405, and 18.9% of families and 23.9% of the population were below the poverty line, subprime loans made houses in Stockton available to thousands who had very little income.

Home construction boomed, house prices soared, and subprime loans kept expanding the bubble further and further. House flippers, speculators and subprime lenders made millions.   

Then, in 2007, the bubble burst.

Few people were more active in profiting from the booming subprime housing market than a young immigrant from Pakistan named Iftikhar Ahmad. 

Between 2003 and 2005, Ahmad made millions of dollars buying and selling more than 100 homes and other properties in the Stockton area.  His company, I & R Investment Properties, LLC, was thriving.  Ahmad deposited at least $8.6 million from escrow closings and was able to send at least $484,000 back home to his native Pakistan.

Ahmad purchased a home at 327 N. Pilgrim Street in Stockton in 1997 for $22,000, then sold and repurchased the same property twice before ultimately selling it a third time in 2005 for $236,000. A house at 2228 E. Stadium Drive in Stockton was bought by Ahmad for $99,000; just 18 months later, he sold the house for $330,000.  In another series of transactions, a house bought and resold several times by Ahmad appreciated in value more than tenfold over an eight-year period.

It sounds like Iftikhar Ahmad was a very smart real estate investor.

The trouble was that Ahmad’s real estate empire was built on fraud.

On October 25, 2007, Ahmad was indicted on federal charges of mail fraud and money laundering, and on April 28, 2008, he pled guilty in federal court to mortgage fraud. 

Ahmad admitted that from July 2003 through October 2005, he participated in a scheme to defraud Long Beach Mortgage, a wholesale lender, in connection with the sale of 10 residential real properties. Between July 2003 and January 2005, Ahmad, through I & R Investment Properties, fraudulently sold 10 residential real properties, obtaining in excess of $1.5 million in loan proceeds.

In each of these transactions, the purchaser financed the property with money borrowed from Long Beach Mortgage.  The scheme involved the use of straw purchasers who lent their name and credit to real estate transactions in which they in fact had no interest. The scheme also involved false statements on loan documents, including those that related to income and occupation, and undisclosed payments by Ahmad of the down payment on behalf of the purchasers.

Many of the mortgages came from subprime lenders and in some cases the buyers used stolen identities. 

And in many of the real estate transactions, the buyers defaulted within a year.

In addition to Ahmad, three other defendants in the scheme have also pled guilty.

John Ngo, 27, of San Ramon, California, a former Senior Loan Coordinator for Long Beach Mortgage, pled guilty to perjury for falsely stating in testimony before the grand jury that he had not received money from a mortgage broker who referred borrowers to Long Beach Mortgage, including borrowers involved in transactions with Ahmad, when in fact he had received more than $100,000 from the mortgage broker.

Manpreet Singh, 24, of Stockton, California, entered a guilty plea to mail fraud for acting as a straw purchaser and borrower in connection with two properties that she purchased from I & R Investments in late 2004 and early 2005. She further admitted that Ahmad paid her in excess of $22,300 for her participation in the scheme.  The properties went into foreclosure within months of the purchase.

Jose Serrano, 44, of Stockton, California, pled guilty to a single count of mail fraud. As part of his plea, Serrano admitted that Ahmad had paid Serrano to recruit straw purchasers, and that Ahmad and Serrano caused several other purchasers to be paid for participating in the scheme.

The case against Iftikhar Ahmad and his co-conspirators was brought by US Attorney McGregor W. Scott, who also indicted mortgage fraud scammer Charles Head. 

Scott said: “This prosecution begins to bring into focus the ways that fraud occurred in the subprime lending market in the Stockton area in the 2003 to 2005 time frame. False representations were made in loan documents; down payments were secretly made by the seller on behalf of borrowers; buyers and recruiters were paid to participate in the scheme; and a loan coordinator working for a wholesale subprime lender was paid by a mortgage broker handling the transactions. The investigation continues.”

Singh’s sentencing date is set for June 9, 2008.  Sentencing for Ahmad, Ngo, and Serrano is set for July 14, 2008.

 

 

Update: Mortgage Scam Website Sill Online

Here’s an update to our earlier post “Mortgage Scam Website Still Online.”

The Web page we originally linked to has been taken down. 

We have, however, found another page that is still on online.

The website says “Let technology and the power of the Internet work for you!  Take the headaches out of shopping for a home loan.”

You can find it here.

UPDATE:

We’ve also found a reverse mortgage website that lists Operation Home Wrecker scammer Keith Brotemarkle as one of its brokers.  You can read our post here.

Mortgage Scam Website Still Online

We blogged yesterday about the federal indictment in “Operation Homewrecker” of Charles Head and 18 others for what the FBI alleges to be a major mortgage scam that defrauded homeowners of their houses, their equity and their credit.

Today we saw that a website of Charles Head’s company is still online.

The website of Head Financial Services (“The Smart Way to Shop for a Lender”) is hosted by the website for Huntington Beach News.

The website promises that you can “Get 3 competing mortgage bids with one easy form” and that “Lenders are standing by now to serve you.” 

 

A representative of the Huntington Beach News told us that the page was a paid advertisement.

He also said that he didn’t know who had paid for the page, but that he needed to take the page down.

The only link on the page is to Charles Head’s email at charleschead@aol.com.

UPDATE:

The Web page we originally linked to has been taken down.  You can see another Head Financial Web page that is still online here.

We’ve also found a reverse mortgage website that lists Operation Home Wrecker scammer Keith Brotemarkle as one of its brokers.  You can read our post here.

“Operation Homewrecker” Nets 19 Indictments for Mortgage Fraud Scheme — With More Charges Soon. Mortgage Brokers Alleged to be Involved.

Federal prosecutors in Sacramento, California, announced today the indictment of 19 people for mortgage fraud-related offenses under what it called “Operation Homewrecker.”

The indictment alleges that the leader of this nationwide scam is Charles Head, 33, of Los Angeles, California, who targeted homeowners in dire financial straits, fraudulently obtaining title to over 100 homes and stole millions of dollars through fraudulently obtained loans and mortgages.

The charges are divided into two separate indictments.

“Head One” involved a “foreclosure rescue” scam, netting approximately $6.7 million in fraudulently obtained funds taken from 47 homeowners, nearly all located in California. The allegations in Head One are that from January 1, 2004 to March 14, 2006, the defendants contacted desperate homeowners, offering two “options” allowing them to avoid foreclosure and obtain thousands of dollars up-front to help pay mounting bills.

If the homeowner could not qualify for the “ first option,” which virtually none could, they would be offered the “second option.” An “investor” would be added to the title of the home, to whom the homeowner would make a “rental” payment of an amount allegedly less than their mortgage payment, thereby allowing the homeowner to repair their credit by having the mortgage payments made in a timely fashion.

All of this was a scam.

The defendants recruited straw buyers as the “investors” who would then replace the homeowners on the titles of the properties without the homeowners’ knowledge. Once the straw buyer had title to the home, the defendants immediately applied for a mortgage to extract the maximum available equity from the home. The defendants would then share the proceeds of the ill-gotten equity and “rent” being paid by the victim homeowner.

When the defendants ultimately would sell the home, stop making the mortgage payment, and/or pursue an eviction proceeding, the victim homeowner was left without their home, equity, or credit.

The following defendants were charged in the February 28, 2008 “Head One” indictment: Charles Head, 33, of La Habra, California; Jeremy Michael Head, 30, of Huntington Beach, California; Elham Assadi, aka Elham Assadi Jouzani, aka Ely Assadi, 30, of Irvine, California; Leonard Bernot, 51, of Laguna Hills, California; Akemi Bottari, 28, of Los Angeles; Joshua Coffman, 29, of North Hollywood; John Corcoran, aka Jack Corcoran, 52, of Anaheim; Sarah Mattson, 27, of Phoenix, Arizona; Domonic McCarns, 33, of Brea, California; Anh Nguyen, 36, of Los Angeles; Omar Sandoval, 32, of Rancho Cucamonga, California; Xochitl Sandoval, 29, of Rancho Cucamonga; Eduardo Vanegas, 28, of Phoenix; Andrew Vu, 39, of Santa Ana; Justin Wiley, 28, of Irvine; and Kou Yang, 32, of Corona, California.

“Head Two” involved an alleged “equity stripping” scheme, netting approximately $5.9 million in stolen equity from 68 homeowners in states across the nation.

While still targeting distressed homeowners and defrauding mortgage lenders through the use of straw buyers, in this version of the scheme, Charles Head would receive approximately 97 percent of the stolen equity, while his “sales agents” and employees, and the other defendants, would receive either the remaining 3 percent of equity or a salary from the fraudulently-obtained funding.

Instead of recruiting straw buyers, as in Head One, in Head Two the defendants allegedly recruited strangers via the Internet. They also used referrals from mortgage brokers to identify and solicit new victim homeowners. Beyond advertising on the Internet, the defendants also would send “blast faxes” to mortgage brokers throughout the country and generate mass emails to potential victims.

Through misrepresentations and omissions, victim homeowners would be offered what appeared to be their last best chance to save their homes. As in Head One, these victims also were left without their homes, equity, or credit.

Those charged in the Head Two indictment include Charles Head, John Corcoran, Kou Yang, each also charged in Head One, as well as Keith Brotemarkle, 42, of Johnstown, Pennsylvania; Benjamin Budoff, 41, of Colorado Springs, Colorado; Domonic McCarns, 33, of Brea, California; and Lisa Vang, 24, of Westminster, California.

The FBI has seized lavish sports cars, a fleet of high-end Italian motorcycles, thousands of documents and a condominium in Miami.

It remains to be seen how far this scam reached, or how many people and institutions were criminally involved.

Prosecutors made it clear that more charges would be filed. FBI Special Agent Drew Parenti said his agency is now “focusing on the industry professionals, the ‘insiders’ who have manipulated the mortgage loan process for their own financial gain.”

Particularly ominous is the statement by federal prosecutors that the defendants “used referrals from mortgage brokers to identify and solicit new victim homeowners”

Whatever the reach of this investigation, we know it is barely the tip of the iceberg of mortgage-related fraud.

We note too that the defendants’ scheme is alleged to have begun in January 2004 – well before the mortgage crisis grabbed national attention – and that the indictment only covers conduct up until March 2006 – well before the mortgage crisis drove many tens of thousands more people into the kind of desperation that the defendants manipulated.

This is only the beginning.

We’re going to see a lot more mortgage fraud indictments.

And as conditions worsen for more and more people who can not pay their mortgages, we’re going to see even more new mortgage fraud schemes.

UPDATE

We’ve discovered the website of Charles Head’s “Head Financial Services.”  To see the website and read the story, click here.

We’ve also found a reverse mortgage website that lists Operation Home Wrecker scammer Keith Brotemarkle as one of its brokers.  You can read our post here.