Eight arrested for mortgage fraud

August 1, 2013

Federal and Ventura County authorities arrested eight people Wednesday for operating a mortgage fraud scheme that made them significant money while causing bank losses of more than $11 million.

Investigators with the Ventura County District Attorney’s office discovered that members of the scheme generated dozens of mortgage loans for unqualified borrowers who were primarily lower-income Spanish-speaking individuals and turned the information over to the FBI.

A Grand Jury indictment details the scheme led by Camarillo resident Jose Garcia and run out of an Oxnard-based company called New Concepts Home Loans (NCHL), where members of the alleged conspiracy prepared mortgage applications that contained false information about borrowers’ income, employment and assets. As part of the scheme, Jose Garcia’s wife and others obtained bogus “CPA letters” from tax preparers that falsely stated the mortgage applicants were engaged in a particular business.

As part of the mortgage application process, the defendants in these cases generated huge commissions and fees – typically at least $10,000 per mortgage.

Lender who suffered losses as a result of the alleged scheme include Washington Mutual Bank, Wells Fargo Bank, Countrywide Bank, IndyMac Bank, SunTrust Bank, World Savings Bank and JPMorgan Chase Bank.

“Jose Garcia and his cohorts are alleged to have lured unsophisticated borrowers with promises of putting them into homes they clearly could not afford,” said United States Attorney André Birotte Jr. “But this American dream quickly turned into a nightmare for these borrowers when they realized they could not afford their new homes. All the while, real estate professionals like Jose Garcia reaped huge profits from the fraudulent loans that they brokered.”

The indictment charges:

• Jose “Joe” Bautista Garcia, 46, of Camarillo, a real estate broker who in addition to NCHL owned Century 21 Premier Realty, who allegedly directed agents to go door-to-door and “cold call” unqualified borrowers in Ventura County;

• Lucy Ann Garcia, Jose Garcia’s wife, 46, also of Camarillo, who co-owned NCHL;

• Jose Fernando Murguia, 47, of Oxnard, a loan officer at NCHL;

• Sesilia Garcia, one of Jose Garcia’s sisters, 30, of Oxnard, a loan officer at NCHL;

• Lili Ayala Hernandez, 41, of Oxnard, a loan officer at NCHL;

• Lidubina “Lido” Mendoza Perez, 41, of Moreno Valley, a loan officer who worked at NCHL’s office in Bakersfield;

• Gregg Scott Quinn, 40, of Camarillo, a loan officer at NCHL; and

• Cesar Rodriguez Azamar, 36, of Santa Paula, an employee of NCHL.

All of the defendants in this case face a statutory maximum sentence of 30 years in prison if they are convicted of the conspiracy count in the indictment.