Cash Back at Closing Perks Used to Stimulate Real Estate Sales

February 2008
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The mortgage meltdown and resulting foreclosure epidemics are an American crisis that will require the united efforts of all citizens of the United States to come together and resolve. Professionals in the real estate and mortgage lending industries need to stop paying homage to the almighty dollar and limitless profits of those good years and hunker down with homeowners to get through these hard times. As I see it, this is the only hope we have to keep the American Dream of homeownership alive.

Fortunately, a large majority of professionals in the real estate and mortgage industries are trustworthy and dedicated to the long-term health of their businesses and careers. Unfortunately, too many professionals are focused entirely on their own short-term interests.

Recently, one of the true blue professionals in my industry called my attention to a situation in Arizona in which she suspects rampant fraud is taking place. She is an honest, well-informed real estate agent who is dedicated to doing her part to clamp down on fraud in the real estate industry, which she loves. She has witnessed other professionals, driven by greed, become involved in cash back at closing schemes that are designed to stimulate the sales of condos by providing buyers with $18,000 to $40,000 in cash (undisclosed to the lender) following closing.

To further hide what was really going on, the people involved in this alleged scheme adjusted it so the cash back would not be paid as a lump sum but paid out in installments in the form of guaranteed rental payments. This tactic did not fool our whistleblower. She tells her story here.

I am writing this because of my concern regarding all of the mortgage loan fraud that has been in the media specifically in the past year.

You are about to read my experience over the past year and what I believe to be a sophisticated case of loan fraud.

My background

I first started in the industry as a RE/MAX receptionist in 1990, since which time I have acquired over seven years experience in the new home arena, over seven years in the resale arena, and three years in the corporate office of a mortgage company.

January 2007

I interviewed for a position the first business day of the New Year and started the following week. I was excited as this gave me an opportunity to explore a whole new area within the new homes arena.

The community, Sunscape Villas, Scottsdale, AZ consisted of 442 units. Sales of the units began in early 2006, and over 210 units were closed on from May to Dec 2006.

Developer/Seller – Partners:

Crown – California company

MCZ Centrum – Chicago company

Sales and Marketing by:

Urbis Properties, Cheryl King, Owner (Licensed)

We were told to get ready as they were in the process of finalizing a special program for one of their power brokers who worked with a lot of investors. We weren’t given much detail only that it was a program similar to what they were doing Landmark on Central (4750 N Central, Phoenix, AZ) that helped sell and close over 70 units. Landmark was Cheryl’s prior community, in the final stages of close out. The Developer/Seller was Crown (out of California) one of the partners at Sunscape Villas.

March 2007

The details had been ironed out and they were ready to launch the new program. A sales meeting was scheduled to go over this program along with two other similar programs that were going to be offered to different groups.

It was stressed to all of us the importance of these programs not getting out to the general public as they were only being offered to the select groups. Making matters worse, the three groups each had different deals set up and no one could know about the other.

Power Broker No. 1 – Moser & Perry

Greg Moser, Realty Expert (Licensed)

Jay Perry, Estate Planner (unlicensed)

Moser & Perry’s Preferred (only) Lender: House 2 Home (Mike Low, Owner)

The program was set up to allow the investors to cash flow for the first couple of years. Two days after close of escrow an Option to Purchase agreement would be drawn up by Urbis and sent to the office of Moser and Perry for Buyer’s (now owner’s) signature and bank wiring instructions. The office of Moser and Perry returned signed Option and wiring instructions to Urbis who would forward on to Seller (Crown/MCZ Centrum) for a pre-determined amount (8-21% of purchase price) to be wired into the Buyer’s (now owner’s) bank account. All parties knew there was never the intent for the property to be (re)purchased per the agreement.

Editor’s Note: This was just a way to kick back money to the buyer under the guise of paying for an option to purchase the property from the buyer, when nobody had any intent of ever purchasing that property from the buyer.)

Greg Moser was set up on a graduated co-broke: 6% for the first 25 sold, 7% for the second 25 and 8% for everything thereafter. He felt confident that he could sell between 70 and 100 units.

The sales staff was instructed that there would be nothing in the purchase contract nor would there be anything in writing regarding the Option given to the buyer. They were told just to refer any/all questions from the Moser clients back to Greg Moser or Jay Perry, all sales needed to do was show the property and print out the contracts.

We were given strict instructions that this agreement COULD NOT be signed until two days after close of escrow. In addition we were told that since this happened outside of closing, neither the real estate broker nor the title company needed to know, as well as this ‘incentive’ was not to be disclosed to the appraisers coming to the sales office for comps of recent closings.

I recalled reading an article on AZ Central.com about Cash Back at Closing, I began questioning if this could be done. I forwarded a copy of the article to the Urbis team. (I had forwarded a few helpful articles before that). After several discussions around the office, a point was made to let everyone know that this was not the same thing as what was written about on AZ Central. We were assured that the attorney’s had looked at the agreement and said that it was legal. A gal in our office was mid-way through her real estate licensing classes and Cheryl King suggested she asked the instructor, which she did and was told that they couldn’t do that. When told what she had learned, Cheryl King brushed it off as not being explained the right way.

Having been in the industry for a number of years, I understood the mechanics of the Option to Purchase. This was not the way I recalled seeing this used in the past. I started to question my knowledge base, but, I didn’t push the issue. After all, who was I to question the corporate attorney or Cheryl with her MBA and paralegal background?

I wasn’t the point person for Urbis and the Option Agreements, as Cheryl had taken on three new listings, two of which I was in charge of the entire contracts & closings process, so I was very busy with those duties. It was out if sight, but never far from my mind.

Being a reader of all things real estate related, I’ve gained valuable insight through out the years. I always make sure I can back up what I’m saying in writing via various publications, statutes, and disciplinary orders. People in my office have referred to me as “a walking real estate encyclopedia,” and Cheryl gave me the nickname “Sherlock” and would come to me frequently to find out this and confirm that, as she was beginning to trust that I knew what I was talking about.

Summer 2007

MCZ Centrum had bought out Crown, making MCZ/Centrum the sole seller / developer for Sunscape. Roles and responsibilities that had been handled through Crown in California had been moved to various people / departments at MCZ/Centrum in Chicago. Shortly thereafter, Moser was informed that certain heads at Centrum were not comfortable with the Option program currently being offered, and it was just a matter of time before they pulled the plug on it.

Moser threw a fit, he was not happy. The Option program was what he was selling (40+ had already closed). Several contracts had been printed and were out to the buyers, and he believed many more were on the horizon. He didn’t understand why they would go back on their word and not let him continue selling under the program exactly the way it was. He had held many seminars, generated from his (and House 2 Home Lending’s) regular talk radio spot on real estate investing, which aired on Wednesdays at 4:00 p.m. on 1100 KFNX-Phoenix).

Then came all the talk of loan fraud becoming a felony starting in September. The change in events piqued my interest into revisiting my original feeling of this not being legal. Why would they stop something that was obviously selling condos? Why was this program never rolled out at the other Urbis listing? Was it possible it was not as legal as everyone was lead to believe? EQR, new Urbis listing, a publicly traded company would have nothing to do with it.

Would this have anything to do with loan fraud becoming a felony in Arizona?

In mid-August, we were informed that the Option program had ended and we were rolling out a new program — Master Lease, Lease Subsidy, Rent Guarantee — it changed names several times as it was being drawn up. I felt a little bit better about this program at first, because at least the title company knew about it as they’re who connected Cheryl with Noteworld.

When the Rent Guarantee program was rolled out, the only difference was instead of the buyer getting a lump sum payment back from the seller after close of escrow, the lump sum payment was going to Noteworld and they would in turn distribute monthly installments to the buyer for 12 or 18 months depending on the terms.

Sunscape had over 30 resale properties listed for sale on the MLS, some of which had been on the market as long as I had been with Urbis. It was apparent that the developer’s pricing was factored in when setting the resale pricing. The majority priced lower than the sales office advertised price – not a single unit had sold.

The Sales office closed 84 units in 2007 (36 under the Option program, 25 under the Rent Guarantee program, and 23 advertised public program); thelast public deal closed on August 10. Not a single Sunscape re-sale sold despite being priced lower during the same time frame.

Leading me to explore further, I looked at other condo’s in our same zip code. According to MLS data there were 43 comparable condos (non Sunscape) that closed from Oct 1, 2007 – Jan 21, 2008 in zip code 85251. The average price per sq. ft. for a one-bedroom/one-bath/was $168 (ours $244 & $276); the average price per sq. ft. for a two-bedroom/one-bath was $171 (ours $276-$325); and, the average price per sq. ft. for a two-bedroom/two-bath was $163 (ours $289).

Needless to say, Sunscape is showing all of the classic signs outlined in the many articles that I had been reading for the past year. We are the only community in zip code 85251 (probably the entire valley) that didn’t see property values decline over the past year.

The appraisers were not informed that 73% of the 2007 Sunscape closings included a non-disclosed cash back after closing ($18,000 to $40,000) given to the buyer.

I originally thought NONE of the appraisers were aware of the of the program, until I discovered one of the two appraisers sent to Sunscape to do all of the appraisals for House 2 Home Lending purchased a property at Landmark on Central under the program. The Owner of House 2 Home, Mike Low, his son Justin Low, his brother Andy Low purchased several units at Landmark under the program.

The final piece of this horrible puzzle has begun with the foreclosures (three are currently scheduled for trustee sale, which were bought under the original Option program with cash back given back to the buyer after close of escrow).

I understand from everything that I have read that it can sometimes take years for these cases to unfold and difficult to prove. I hope that all of the information that I have compiled over the past year will help in expediting the process and stop this before it goes any further.

Ruth Lamb

When you see rampant mortgage fraud like this being committed by the very professionals that we trust to do the right thing, it becomes very difficult to place faith or trust in our fellow Americans or to trust the systems we have in place to protect us. In this case, the perpetrators are being rewarded, not only with increased commissions from selling properties with inflated values, but we also see the companies they work for rewarding them for their supposed achievements.

Until this stops and we get serious about policing our industry and shutting down the fraud, it will continue to chip away at the very foundation of our industry. It will generate distrust among our clients and potential clients and eventually lead to the demise of the industry on which all of us earn a living and feed our families.

We need to begin to follow this whistleblower’s lead and, like her, have the tenacity to follow through and put the fraudsters out of business for good!

Posted By: Ralph Roberts @ 10:17 pm Comments (87)
Filed under: Appraisal Fraud,Arizona,Cash Back at Closing,Foreclosure,Mortgage Fraud,Real Estate Fraud

87 Comments »

Way to go Ms Lamb. My brother bought into complex like this last year,(differnt state) He didnt know that he was over paying because he didnt get any money back, and now its not worth 1/3rd of what he paid.

Comment by FightnCarol — February 27, 2008 @ 11:32 pm
I went to Sunscape a couple months ago. It is a great location, but was WAY overpriced(now I know why)! I bought a bigger, upgraded condo in the same zip code for around $75,000 less.

Comment by Agent in AZ — February 28, 2008 @ 3:02 pm
Dishonesty or Stupidity? What are developers, mortgage brokers, realtors thinking? This cash back scheme is going on all over the country. Are all these business people laying awake nights developing illegal and fraudulent schemes.

What an epidemic. Greed has led to total stupidity. To prove that point, the participants as noted above, buy units themselves and truly believe in the program. How stupid. They sell their “poisoned” cake and then eat it too.

I’m not sure you can cure stupidity hence stop this kind of activity from occuring. Developments like this must have attorney representation, how do these legal eagles justify what their clients are doing?

What we can do is EDUCATE the general public like Flippingfrenzy and others are doing. An educated consumer is our best consumer. Remember those ads from a clothing retailer?

If it’s too good to be true (and to easy), it probably isn’t. CAVEAT EMPTOR.

Comment by Larry Rubinoff — February 29, 2008 @ 8:19 pm
I dont understand how these things can continue to go on. Doesnt the real estate board do something about these situations. I worked with a agent years ago that was dishonest, and she got what was coming to her. I think everyone from the real estate agent that over saw the transaction to the buyer to the mortgage broker to the person wha made copies in the office need to pay for this. I want to see them have to pay back all the money. If they have blown the money on homes adn expensive cars then take those. Or better yet, let them pay it back by going time in tent city…Doesnt Sheriff joe pay the men 2.50 a day for work. The crroks can pay it off that way…

Comment by Robert AZ — March 1, 2008 @ 12:51 am
A sales rep who formerly worked at Landmark on Central supposedly sold a very large number of units (40 or 50) in a very short period of time (30 – 45 days) when the market was extremely slow (I think it was spring of 2007). At the time I did not know if it was simply a sales pitch to get me excited to buy a unit before they were all gone or if it was true. In fact I still don’t know if it is true except that I ran into the same sales rep in October of 2007 and she reconfirmed the story. By then she arguably had no reason to hype the property since it was sold out and she no longer worked there. But who knows?

Did anyone else hear a similar story? Again, maybe it’s all bogus.

Comment by just wonderin' — March 3, 2008 @ 6:35 pm
Both of these projects are Cambridge Property projects. Possible ties to Cambridge?

Comment by deep throat — March 3, 2008 @ 7:17 pm
Cheryl King originally was the Listing Agent at both Sunscape and Landmark (her Real Estate License was hung with Cambridge Properties until Nov 2006). When she transfered her license to a new company (Nov 2006) the Sunscape listing transfered with her and the Landmark listing stayed at Cambridge as there were only a handful of units left to sell. I believe that is the extent of the Cambridge connection.

Comment by Ruth Lamb — March 4, 2008 @ 5:59 am
Are the sales agents responsible? Or is the company?

Comment by Curious — March 4, 2008 @ 1:10 pm
From everything that I have read on the subject – which has been a ton – over the past year, as well as the additional knowledge and insight I have gained from the various agencies currently investigating cases such as this… ANYONE / EVERYONE who has ANY contact with a fraudulent transaction (buyer, seller, sales agent, buyer’s agent, broker, loan officer, appraiser, escrow officer, loan processor and contract & closing coordinator) is responsible if they knew these deals were taking place.

As a Licensed Sales Agent it is YOUR responsibility (as a holder of that license) to look past the dollar signs clouding your judgment and start using simple logic – are you an ‘order taker’ or are you a professional?

Basic Test Questions:
#1 – LENDING GUIDELINES: What is the maximum allowable Seller contribution – for Primary Buyers? Second Home Buyers? Investors? Those guidelines are there for a reason (no, the reason is not so that others can ‘invent’ schemes to bypass those guidelines).

#2 – PURCHASE CONTRACT: Is in BLACK & WHITE for a reason – there is NO GRAY area when dealing with a written contract. Get everything in writing – then there is NEVER any question as to it being disclosed to ALL parties. If everything is legal and on the up & up then there should never be an issue including it in the contract.

#3 – (Buyer’s)… KNOW WHAT YOU ARE SIGNING
– (Agents)… KNOW WHAT THE BUYERS ARE SIGNING

(the following is taken directly from the Sunscape Villas Purchase Contract page 10 section 15.(a)….

15. MISCELLANEOUS.
(a) Disclosure of Additional Representations. Seller wishes to avoid any misunderstanding concerning the purchase of the Unit. It is the policy of the Seller not to enter into any oral Contract or to ask any Buyer to rely on any oral representations concerning the Unit, the Condominium or the surrounding areas. The entire Contract between Buyer and Seller must be in writing. Therefore, Buyer shall write in below any rcpresentations or promises which are not set out in this Contract, but which have been made by Seller or its purported brokers, agents or employees, and upon which Buyer is relying in making this purchase, and if there are none. Buyer shall so indicate by writing the word “none” and placing its initials thereafter.

EVERY Contract written at Sunscape during 2007 – including ALL of 61 contracts that included the Buyer receiving $18,000 – $43,000 Cash Back (from the Seller) after Close of Escrow has the word NONE clearly written and then initialled by the Buyer.

Hmmm…. you mean to tell me that absolutely 100% of those Buyers still would have purchased under the terms of their contract without the expectation of receiving a Cash Back Incentive?

Comment by Ruth Lamb — March 5, 2008 @ 12:18 am
During Landmarks launch and Grand opening approx. 150 condos were sold within the first couple of months. All those condos were sold under normal lending terms.
This has nothing to do with Cheryl King and the mtg. issue that is being disussed here.

Comment by reply to "just wonderin'" — March 10, 2008 @ 1:33 pm
That leaves only another 200 possible fraudulent transactions. What are the parties that are involved supposed to do now? What if I didnt know what was going on was illegal? What if I was just doing what my investment advisor and realtor told me to do? What if the girl that sold me the condo told me “not to worry”. How do I know if they all knew it was wrong and I was just a pawn… Is it possible to be an innocent party to this type of illegal activity?

Comment by do gooder — March 12, 2008 @ 7:51 pm
My advice to do gooder and any other ‘innocent’ parties involved would be to contact the authorities (FBI, DFI, DRE) and give their account of what exactly they were involved in and what they were told by their investment advisor and realtor. Afterall, the authorites are going to need all aspects of the story in order to fully prosecute the bad guys.

Comment by Ms Advice — March 13, 2008 @ 4:25 pm
This whole thing sounds like a bunch of Hooey! I would bet you nothing will come of this and it will all come to the surface that the parties just pissed Rith Lamb off. I looked, and Cheryl King and Greg Moser are both still licensed in Arizona. No skeleton in the closet. Look beyond the hype and showmanship. WHATEVER!

Comment by just looking in AZ — March 18, 2008 @ 7:56 pm
To: ‘Just Looking in AZ’

First of all, NO ONE pissed me off… Yes, Cheryl King & Greg Moser are both still licensed in AZ – it you go to http://159.87.254.2/publicdatabase/ (which is the AZ Dept of Real Estate – datebase) look up Cheryl and Greg, scroll down to the bottom and they each have a complaint filed under their licenses.

The AZ Dept of Financial Institutions, AZ Dept of Real Estate and The FBI – ALL have open ongoing investigations into this matter. Unfortunately it takes time for the authorities to fully investigate and prosecute white collar crime.

Comment by Ruth Lamb — March 18, 2008 @ 9:15 pm
Hey, “Just Looking in AZ”:

No offense meant but if you wanna stick your head in the sand and ignore the facts, go right ahead, but just because someone is still a licensed relator doesn’t mean that what they did wasn’t wrong. It could simply mean, couldn’t it, that the long arm of the law simply hasn’t caught up with them yet.

Comment by Just responding to Just Looking in AZ — March 18, 2008 @ 9:15 pm
Additonal Follow-up to: ‘Just Looking in AZ’

#1: I was not, never have been, a disgruntled employee – no axe to grind with anyone, frankly that type of behavior is a waste of time and positive energy.

#2: I had/have NOTING to gain with my decision to bring this situation to the attention of the necessary authorities – I was just Doing the Right Thing, Because It Was the Right Thing to Do!

#3: I actually had/have EVERYTHING (almost) to lose. A 19yr veteran of (true) Single Motherhood (zero emotional, physical, or financial assistance from anyone) – I like many others survived paycheck to paycheck.
a: I walked away from the situation having no spouse
or significant other at home helping meet my financial
obligations, having $0 in savings and relying on my
next (now final) paycheck to finish paying the current
months bills that were due.
b: I walked away from my job without having another
job lined up, let alone any prospects of possible
employment opportunities, knowing that layoffs had /
have been running rampant in my industry – especially
in my type of position.

I am now 7 weeks into this ordeal, the vast majority of that time has been spent preparing for and meeting with those assigned to this case at the three agencies currently involved (I have been told there are other agencies that might become involved as well at some point). I initially provided close to a thousand pieces to this (very large – very complex) puzzle – all placed neatly in an easy to follow, tab divided 4” binder – and I have continued to research, document and compile additional information (all a matter of public record) that will be provided to the authorities at an upcoming follow-up meeting.

Having heard that cases such as this can sometimes take 2 years (from start to finish) to prosecute, that combined with the available resources of the various governmental agencies continues to be stretched to the limited due to the high volume and increased case loads that this type of rampant fraud has perpetuated. I am happy to give of my time, share my knowledge and provide ongoing factual information (as needed) to the appropriate investigating agencies.

The time and effort I have invested in all of this over the past 7 weeks, far surpasses that of a 40hr a week job, leaving little to no time available to completely re-enter the ranks of the gainfully employed. Albeit limited, I have far from neglected my employment (or lack thereof) dilemma – as it is an absolute necessity for my survival – sending out 8-10+ resumes weekly for several weeks now, unfortunately, the job opportunities currently available are few and far between.

I share my trials and tribulations with you in hopes that my experience will somehow help someone from venturing down the path with suspected fraudsters unknowingly and/or possibly give others that find themselves caught in the same position I was in, the strength and courage to report their situation to the appropriate authorities. I may lose my car, I may lose my house, but two things that I will NEVER lose – nor will I allow to be compromised by another – are my freedom & my integrity.

Comment by Ruth Lamb — March 19, 2008 @ 3:01 am
Good luck and God bless you, Ruth.

Comment by Dawn — March 19, 2008 @ 6:36 am
Hi Ruth. I want to thank you for all the hard work you’ve done on this case. I have two friends who purchased into sunscape last summer, and while they both believe they were not in any way involved in the scheme you’ve outlined – in my opinion they’ve both been negatively impacted since this scheme fueled the inflated appraisals of their properties. Since they purchased, their properties have dropped nearly 50K each in value, and it could likely be many years before they can even begin to think of refinancing… unless they can sock away enough money to do so. Please contact me at eugeneclemens@gmail.com for more information- Thanks, Eugene.

Comment by Eugene Clemens — March 23, 2008 @ 4:30 pm
reply to Eugene Clemens;
Sorry to hear about your friends! I’m alitte surprised by what you have written here regarding their property values at Sunscape dropping 50k each. See for the most part values are all tied to Sales – Appraisals – Closings. Currently, the Sunscape Sales Office still holds most of the cards in those depts as there has only been 1 resale (EVER) and now 2 foreclosures.

Appraisers who determine a property’s value for the lenders to loan on when borrowers are either re-financing or puchasing use 3 recent sales (closed transactions) if possible – ALL in the same community. The appraisers usually go to the Sales Office to get information on recent closings of comparable units. The sales staff is at liberty (within reasonable time frames) to pick and choose which units the provide.

I heard they – just recently – lowered prices at Sunscape, but have not been able to confirm what the current prices are. I just looked on Tax Records to see what they have recorded in new sales. Unless I am reading incorrectly, they have only closed 1 unit since I left and yes, it is for substantially less then they had been selling for. I guarantee you – that sale will be the LAST they use for a comp and only then if they have too.

Unfortunately, what you have written, I fear is what’s to come in the very near future for Sunscape – there just aren’t the comps to suggest any amount of property value decline currently.

Comment by Ruth Lamb — March 23, 2008 @ 6:11 pm
I just want everyone to know how real this fraud scheme is!

If anyone is reading this website because they are involved with Jay Perry, Greg Moser, Justin Low, or any of the others listed above for that matter – HUGE RED FLAG! – If you are looking up this website because …. you are thinking of these people “helping” you with estate planning, or you are doing any real estate transactions with any of them, or you are thinking of going into a business venture with these people, or they are going to “help” you with ANYTHING … DON’T DO IT! Alert the FBI so these people can be stopped. Take the time to go on-line and research (for free) all the court documents related to these people and the suing, foreclosures, etc. going on. You will be shocked. An enormous thank you to Ruth for her invaluable article and her passion to change laws to stop fraud. Thank you also to the originator of this website because without this medium to expose fraud, it will just continue.

Comment by HUGE RED FLAG! — April 4, 2008 @ 1:57 pm
Ruth, can you give us an update. Are the agencys responsible for proscuting these types of issues taking the charges against Cheryl King seriously? I certainly hope they are and are moving forward to prosucute her.

Curious

Comment by Anonymous — April 10, 2008 @ 2:58 pm
This goes even further than what has been described… Cutting broker fees from House 2 Home back to Mosier/Perry… Illegal!!!!!!

Comment by Anonymous — April 18, 2008 @ 1:52 am
Check and see the loan docs from House 2 Home on all these deals… You will not be shocked to find out that Jay Perry also acted as the Notary. Shocker!!!!!!

I feel sorry for the poor elderly clients Jay Perry takes advantage of everyday… If you have money in any account he manages I urge you to move it and move it fast…

Comment by Anonymous — April 18, 2008 @ 2:07 am
If not for this website, I would have never know about these illegal real estate dealings. I am a victim, and I feel violated. Trusting that someone and their representatives are helping you, only to find out it is all fraud, takes the wind out of your sails. I only hope that they will get what is coming to them.

Comment by Anonymous — April 24, 2008 @ 6:29 pm
I would have to agree whith anonymous Trusting someone is the hard part I don’t think I can trust anyone because there are all kinds in this world

Comment by Bob McNeilly — April 24, 2008 @ 6:36 pm
It’s interesting that everything Jay Perry owns is in foreclosure and is being sued for bad investment deals. Think about it, is this someone you want doing your financial and estate planning? I wouldn’t trust him as far as I coud throw him!

Comment by Anonymous — April 24, 2008 @ 11:16 pm
I can confirm that an unidentified female using the aliases “Julie Smith” and “Jenna James” has been trying to create noise around the two realtors named in this blog. A female called me after reading a complimentary comment in our magazine re Cheryl King and made various allegations, citing this blog as the source of her knowledge. Just because its on the web DOES NOT MAKE IT TRUE.
I suspect it was Ms Lamb trying to build her case.

As a publisher we are very careful about fact and copy checking in print articles for professional reasons, most of all being certain of our facts. Bloggers feel they can say anything. I asked “Ms doyourduediligence” to tell me who she was so we could check and get back to her. We got a dance and a fake name.

Ruth Lamb was an employee of Cheryl King and is listed as “ineligible for rehire.” The two complaints alleged at the Arizona Department of Real Estate are anonymous but have the same grammatical characteristics of the blog, phone calls and emails.

This is similar to the disinformation campaign Goebels ran a for one of history’s better known tyrants. If you say it enough someone may believe you.

Ms. Lamb: if the facts support your allegations do not destroy your credibility by alleging misfeasance anonymously then denying your identity when you are outted. Right now you look stupid.

Andrew Waite – Publisher Personal Real Estate Investor Magazine

Comment by Andrew Waite — May 6, 2008 @ 12:30 pm
To Mr Andrew Waite;

I have two questions for you:

#1-Are you saying what I have written in my original statement above did not take place? Because I have documentation saying it did
-OR-
#2-Are you saying that the Cash Back Deals are not Illegal? Because the FBI, Dept of Real Estate, Dept of Financial Institutions have told me that these Cash Back Deals ARE Illegal.

Each and everytime I have spoken to anyone regarding this (FBI, DRE, DFI, Cheryl King’s Broker, Greg Moser’s Broker and every comment on this Blog), I have signed my name to it – as I have NOTHING to hide

I have not contacted you or your office but I am happy to speak with you directly if you would like verify YOUR facts as the true professional you are.

Thank you,
Ruth Lamb
rlamb222@cox.net

Comment by Ruth Lamb — May 6, 2008 @ 2:46 pm
I find the Mr Waite “posting” interesting.. A self-proclaimed fact checking professional posts an entry on a blog and states what he believes as fact, but implies that all other entries are falsehoods and/or feels it necessary to compare them to Nazi Propaganda. Under his own admission, he doesn’t know the “caller” is Ruth Lamb, and yet he results to calling her “stupid”.

Mr Waite, some questions for you…

1. What fact finding avenues did you take, prior to your accusation, to “prove” your caller was Ms Lamb? Are you implying there is only one real estate educated, internet savvy, well informed and articulate female that could be the caller?

2. What fact finding avenues did you take to “prove” Cheryl King was deserving of “complimentary comments” in your magazine? Is it because she makes a lot of money selling overpriced property? Is it because she got away with fraud for over year?

3. What fact finding avenues did you take to contact the authorities to see if the information contained in this blog is true? Did you make the call to Department of Financial Institutions? Or maybe Federal Bureau of Investigations? Yea, Didn’t think so.

4. Do you make a habit of profiling real estate professionals that are currently under investigation for FRAUD?

You indicate you were fully aware of the investigation, How did you know “The two complaints alleged at the Arizona Department of Real Estate are anonymous but have the same grammatical characteristics of the blog, phone calls and emails.” Because the Dept. of Real Estate prides itself on keeping complaints confidential until the outcome is established / dismissed. That can only mean you have seen the compliant via your relationship with Ms King or Mr Moser.

We all look forward to your response to Ms Lamb.

Mr Waite, one last question…

Now, who looks stupid?

Comment by Common Sense Dictates — May 6, 2008 @ 4:44 pm
I have to tell you, it’s beyond disheartening when the so called “professionals” are so gullible. I’ve heard one woman state that “s/he wouldn’t have such a popular website if they were a crook. Someone would have exposed them by now!”

People, DO YOUR HOMEWORK. Trust no one – until you have thoroughly checked them out. Their own claims to fame don’t count.

Comment by Dawn McNeilly — May 6, 2008 @ 5:02 pm
For clarification purposes on previous comments posted and feedback I have received from others I WAS NOT FIRED as Cheryl King, Greg Moser and/or Jay Perry have indicated to others.
Below is a copy of the email I received from Cheryl King herself.

As I have stated many times before and will continue to state – I have NOTHING to hide – anything I say – I can back up via written documentation and I proudly sign my name so that my credibility can never be brought into question.

From: Cheryl A. King [mailto:cheryl@urbisproperties.com]
Sent: Wednesday, January 30, 2008 10:48 AM
To: Ruth Lamb; Ruth Lamb
Subject: FW: Please call me

Ruth,

I left you a vm message yesterday morning and sent you this e-mail. It is 10:45 today and I have not heard from you. Based on this, I assume that you have voluntarily resigned your position. While your last day at work was 1/25/08, I have paid you through the end of the month.

I will send your W-2 Form and your paycheck for the period ending 1/31/08 today by certified mail.

Please call me to arrange for the return of all company property, including the contract files for The Taos and keys to the sales center.

I wish you all the best.

Cheryl
–
Cheryl King
URBIS PROPERTIES . . . . . .

Comment by Ruth Lamb — May 6, 2008 @ 11:01 pm
Today I heard from Ruth Lamb her-own-self. She claimed she was not “Julie Smith” or “Jenna James.” I promised her I would correct the suspicion that she had hidden behind these aliases but I can not shake the sense that allegations, the style and the tone were identical to the avitars. She had no trouble identifying herself and explaining her position.

She claimed to know the sources of the anonymous complaints, calls and emails. Ms. Lamb even admitted to placing the first anonymous complaints with the Arizona Department of Real Estate herself. When they did not take her seriously she resolved from that point forth to identify herself to the AZ Department of Financial Institutions and the FBI. She was clearly effective as she now states the female FBI agent she provided information to assured her that the subjects of her complaint would be going to jail.

As a trained lawyer I find it hard to believe a professional FBI officer, part of the Department of Justice, would claim the powers of investigator, prosecutor, judge and jury to a voluntary informant.

My impression this is one “inspired” woman who is on a mission. Thank God for American due process and not Kangaroo Courts of Robert Mugabe. God Bless and great investing.

Andrew Waite

Comment by Andrew Waite — May 6, 2008 @ 11:34 pm
Dear Common Sense Dictator: To your question –

3. What fact finding avenues did you take to contact the authorities to see if the information contained in this blog is true? Did you make the call to Department of Financial Institutions? Or maybe Federal Bureau of Investigations? Yea, Didn’t think so.

Response: I did a whole lot better than you can imagine and got close enough to understand there is probably NO active investigation on these in either municipal, state or Federal law enforcement agencies. I speculate they have bigger fish to fry instead of a couple of minor actors.

And before anyone accuses us of not being consumer friendly, check Personal Real Estate Investor Magazine. This title is now available on B&N, Borders and airport newsstands nationwide where we are now the seventh best business & finance monthly title after Money, Smart Money, Fortune, Forbes, Entrepreneur and Forbes Small Business.

Best: Andrew Waite – Personal Real Estate Investor Magazine

Comment by Andrew Waite — May 6, 2008 @ 11:48 pm
This is my response to Mr Waite’s take on our conversation.

Mr. Waite told me that my voice was NOT the same of the person whom he spoke to before and that he would clarify that on the blog. (which I do not believe he fully as he indicated to me he would do on via our conversation).

I told him I suspected who might be the source of the anonymous complaints, calls and emails he received – but I did not know for certain. There are several Moser/Perry Clients that are victims here and feel they might be retaliated against if they used their name when getting the word out, so yes they may be hiding from people like you Mr Waite, but they are not hiding from the Authorities.

I would encourage others (victims, unknowing participants, buyers, sales agents, etc) to do as well – Contact the FBI, DRE, DFI if you believe you were party to these transactions – they will want to hear your side…. better to contact them, before they come knocking on your door (and they will at some point).

As far as the DRE, DFI and FBI, (THEY contacted ME for all of the documentation I had) they knew from the start, who the source was even though at the very beginning – prior to Jan 31, 2008 my statement was signed anonymous (for other reasons) not for the purpose of hiding my identity from the authorities.

Signing my name to this Blog and/or anything else, HAD NOTHING TO DO WITH ME AND/OR MY COMPLAINT NOT BEING TAKEN SERIOUSLY. Each Dept and Agency that has contacted me has taken this VERY SERIOUSLY and I have been assured by more than just the FBI, that what has happened is indeed ILLEGAL and WILL be prosecuted fully.

Again, this is White Collar Crime and for whatever the reason – it takes longer to bring the bag guys to justice.

Comment by Ruth Lamb — May 7, 2008 @ 12:19 am
Response to Mr Waite’s Response: ‘I did a whole lot better than you can imagine and got close enough to understand there is probably NO active investigation on these in either municipal, state or Federal law enforcement agencies. I speculate they have bigger fish to fry instead of a couple of minor actors.’

Mr. Waite – You are unbelievable in your thinking and research…
It is people like you that is at the root of all of the problems in our industry.

All I have left to say to you is: TIME WILL TELL and when it is ALL said and done (even if it takes a year for the authorities to complete their investigation and charges to be filed) I will be bringing this to your publication and will expect a complete apology.

NOTE TO ALL: Not once during my conversation with Mr. Waite did he take me up on my offer to provide the investigator’s names and/or contact information (DRE, DFI, FBI) that each have OPEN INVESTIGATIONS into this matter.

Other people have and have themselves been able to confirm and provide additional information regarding the OPEN INVESTIGATIONS to these agency’s.

Comment by Ruth Lamb — May 7, 2008 @ 12:36 am
I believe you, Ruth.

Your experience with the FBI has been very similar to mine.

Comment by Dawn McNeilly — May 7, 2008 @ 6:38 am
Mr Waite,
Let me start by saying I am not directly involved in any of the transactions that have been outlined in this blog. I am however, as an actively licensed real estate agent in Arizona, an interested party in illegal dealings within the real estate community. Contrary to your previous posts, this type of deception DOES affect all of us in the industry. I would like to believe, a “professional” such as you, would comprehend the devastating ripple effect that is created when criminals such as these are infecting the market. I would only assume you would have particular interest in the negative undulation, being that there is an Andrew Waite that owns property at one of the locations where the questionable dealings took place.

I must commend the previous post that questions your “research” prior to your accusations. I too, find it interesting that you have made no real point in your postings. Unfortunately, you have taken this informational forum to attempt to personally attack and discredit Ms. Lamb. You have been asked several very direct questions and have failed to answer any of them. Ms Lamb, point blank, asked if you were implying these cash back transactions actually took place and/or if you felt they were illegal, if indeed they did take place. No response.

I have personally seen the evidence of the transactions. I can only imagine Ms Lamb offered you the same opportunity to examine any and all supporting documentation, as it is my understanding she will offer to do this with anyone of whom makes the request. Ruth offered you the investigator’s names and contact information of those state and federal agencies investigating the business dealings. You declined to take her up on this offer. I did accept that offer. I assure you this case is in the office of AZDFI and FBI. I know this for a FACT.

As far as if the transactions are illegal, anyone within the industry knows that cash back, outside of escrow, not listed on the HUD, without the lenders knowledge and above the allowable percentage, IS ILLEGAL. There is no challenging that.

As far as your ignorant statement of “they have bigger fish to fry instead of a couple of minor actors.” From what I can gather from county tax records, county recorder’s office and other equally accessible public “avenues” these “actors” are not “minor”. Let’s break it down for the masses…

Approximately $30,000,000. (Thirty million dollars) in fraudulent loans were processed. This does not include the loan amounts of the unfortunate buyers that purchased honestly, at inflated prices, based on the counterfeit appraisals performed on the properties.

There was over $4,000,000 (Four million) in cash back given to the buyers after close of escrow, without the lenders knowledge.

Do I need to outline the approximately $3,000,000. of unearned and fraudulent commission proceeds that are lining the pockets of Cheryl King and Greg Moser?

Do I need to list the numerous properties that took advantage of this scheme that are currently in foreclosure?

Tell me, what dollar amount equates a fish big enough to fry?

You also have the audacity to compare Ms Lamb’s courage to come forth to that of propaganda used by Hitler, written by Joseph Geobbels. If any related works could be compared to this spawn of pure evil, it should be that of yours; by using paid consultants/advertisers to produce news reports and opinion and sell it to the public as gospel. I have taken the “research avenue” of reading your webpage as well as digging up some articles…I found it interesting as someone of whom, (to quote YOUR publication) “…has had a significant presence in Personal Real Estate Investor magazine for the past four years, both in advertising and editorial content” “…was banned in early April from conducting real estate business in Arizona by the state Department of Real Estate. The action came on the heels of a January $17.4 million civil judgment against (name removed) and his wife in Maricopa County Superior Court.” Can I assume, if I had the time to dig further, Ms King and Mr. Moser will have contributed editorials or advertising dollars to your publication as well? If you take the time to read everything within these pages, you will see that Ruth is sharing her experience in this distasteful drama. She is not trying to boost the sales of her book, magazine or memoirs… If she says anything that is based on opinion alone, she states it’s her opinion and nothing more. She has made no allegation that she does not have documentation to support.
I also laugh at the comparison of this situation to that of the “kangaroo court” of Zimbabwe. Obviously, the outcome of this investigation has not yet been determined, but I ask you… If you have a man standing over the dead body of a gunshot victim, holding a gun, covered in blood, with the instructions on how, when and where to find the victim, a diagram of physically where on this person the victim is to be shot, an email telling people how he’s going to shoot the victim, ten unrelated adults as witnesses and a video showing the man shooting the victim unprovoked… Do you think the police, with confidence, will tell the family of the victim he’s going to jail?

You refer to yourself as a “trained lawyer”. I am not sure what exactly that means, as I have tried looking you up on the Arizona State Bar Association and I cant seem to find your practice anywhere. I have also tried to locate your real estate office at the AZ Department of Real Estate and am unable to find you as a licensed agent there either.

Again, I am in no way a part of these proceedings nor do I care to be. I am not a selfproclaimed guru of any kind. I am not the “Julie Smith” or “Jenna Jameson”. However, I AM a “real estate educated, internet savvy, well informed and articulate female” that without hesitation will stand behind Ms Lamb until the end. May we all have half the tenacity as she does to confront the parasites that continue to contaminate the real estate industry.

Comment by J Barnes in Arizona — May 7, 2008 @ 6:28 pm
I been reading and all 3 Adrew waite ms. lamb and J barnes all have one thing in common. Look at the documents in the case seek the evidance for or agenst. And the most importate thing to remeber is what Mr. Wait said Just because its on the web DOES NOT MAKE IT TRUE. Seek the truth.

Comment by Bob McNeilly — May 7, 2008 @ 10:50 pm
Mr waite, ms King and most of all mr. Moser are the biggest frauds ever. I know all of them and if you are doing business with any of them don’t walk away run!!!!!!!!!!!!!!!!!

Comment by freddie — May 21, 2008 @ 11:49 pm
STATUS UPDATE TIME: 16 weeks and 200+ resumes later and I finally received a much needed offer to return to the working world – just in the nick of time as I’m on the verge of losing my home. What a huge relief – now, being gainfully employed, my lender will work with me on restructuring my loan and I can save my house. Actually thought I was beginning to see a glimmer of light down this long dark tunnel that has been never ending since this Mortgage Fraud ordeal started back in January.

My first day was Monday, May 19th and it appears my last day was Tuesday, May 20th. No this isn’t some sick joke or is it? At some point Tuesday afternoon, my involvement in a Mortgage Fraud case was brought to my employer’s attention. It was brought to my attention first thing the next day, prior to leaving my house, Wednesday morning.

I tried explaining that I WAS NOT the BAD GUY here. I was a Good Guy, with a true sense of integrity – ethically and morally sound – obeyed and upheld the governing laws and regulations – rules and responsibilities that are required by ALL Arizona Licensee’s. I did a good thing – I did the right thing…. unfortunately I think it all fell on deaf ears.

The reason I was given was (their fear) that I was a Legal Liability – how could I be a legal liability? I did nothing wrong, I did everything right unlike the (Other) 35+ Industry Professionals that each had an active, working knowledge and participation in this case of mortgage fraud – those are the people that should be considered Legal Liabilities – not me…

The secondary reason was because I wasn’t forthcoming with my involvement in the case, before being offered and accepting the job. I’ve had to resort to the Don’t Ask – Don’t Tell policy during the past 4 months (200+ resumes) job search. If asked why I left my prior employment, I disclose my involvement in the case – otherwise, I say nothing, which is exactly what happened here. I knew full well that I would eventually need to inform them, depending on the disposition of the cases.

I emailed management a link to this article, as well as the contact information for each of the (three) Investigators asigned to this case – so they could verify the accuracy of my statement regarding my involvement in this case – none of it seems to matter – it appears I’m back at jobless, square one.

Now 16 weeks into this nightmare, which is fast becoming a personal hell… Would someone please remind me WHY doing the right thing is the right thing to do, as I have officially lost all hope in the integrity base of my fellow human beings. I did the right thing and I’m being punished on every level – doesn’t seem quite right……

Ruth

Comment by Ruth Lamb — May 22, 2008 @ 5:08 am
Ruth,
I am so sorry to hear of your trials. I am going to be contacting anyone I know over the next few days to see if I can help find a position for you. I’ll do my best and be in touch if I can help. I hope others in our profession will do the same.

God bless you and your family

Comment by Anonymous — May 23, 2008 @ 7:30 pm
Ralph, you say,

“Until this stops and we get serious about policing our industry and shutting down the fraud, it will continue to chip away at the very foundation of our industry. It will generate distrust among our clients and potential clients and eventually lead to the demise of the industry on which all of us earn a living and feed our families”.

“We need to begin to follow this whistleblower’s lead and, like her, have the tenacity to follow through and put the fraudsters out of business for good”!

I could not agree with you more. The injustice of these fraudulent practices has tainted both the mortgage and real estate industries. Like Ruth, many thousands of “good”, “honest” and “hard working” people in both industries find themselves in the same position of being unemployed, losing their cars, homes and credit. Like the victims themselves, these former employees have been victimized. Unlike the actual victims of fraud, they have no legal avenues to follow even if it is for mere satisfaction.

Like Ruth, I know many who have as many if not more resumes out with no responses. Some have even been rejected not because they were involved in any way with fraud but simply because they were involved in the mortgage industry.

I fear that the demise of the mortgage broker industry has already begun-led by the leaders of the industry-who many now acknowledge were a primary cause.

If you think you can trust your bank, think again. The end result will be higher costs to the borrower-without their knowledge-as banks do not disclose their YSP. Their low pay scales will dictate the experience levels of those they hire to originate. If lack of education was a problem up to now, it will be more of a problem in the future. Many are still employing bad lending practices. At least now they will have no scape goats.

The inability to trust is certanly a sad commentary on our society.

Ruth, I commend you for your pro active role. I apologize on behalf of our industry that you are suffering as a result. Good things happen to good people, so hang in there.

Comment by Larry Rubinoff — May 28, 2008 @ 6:07 pm
CHERYL KING – GREG MOSER – JAY PERRY – MICHAEL LOW – JUSTIN LOW – AND OTHERS INVOLVED IN THIS CASE OF REAL ESTATE MORTGAGE FRAUD….. YOU’RE NEXT!!!!

The link below cleared the grand jury/indictment/arrests process and your case is next in line.
http://www.abc15.com/content/realestate/story.aspx?content_id=68d16405-3f8d-44c6-a4c2-28e894b2e33f

check out these 9 indictments here in AZ
http://www.abc15.com/content/news/15links/story.aspx?content_id=6d9dff41-ee8b-452b-a140-d5aeeb83896d

Comment by Ruth Lamb — June 20, 2008 @ 4:20 am
“THE F.B.I. SAID MORE ARRESTS ARE EXPECTED TO FOLLOW AFTER MORE COMPLAINTS COME INTO THEIR EMAIL ADDRESS AT” px_cashback@ic.fbi.gov

“IF YOU OR SOMEONE YOU KNOW HAS BEEN A VICTIM OF MORTGGE FRAUD, THE F.B.I. WOULD LIKE TO HEAR FROM YOU”

I urge ANY of the BUYERS who purchased property at LANDMARK on Central in Phoenix, SUNSCAPE Villas in Scottsdale , or other property using GREG MOSER – JAY PERRY – CHERYL KING – MICHAEL LOW – JUSTIN LOW – HOUSE2HOME LENDING and received ANY FORM of: CASHBACK/INCENTIVE/ALLOWANCE/LEASE BACK/RENT GUARANTEE MONEY to contact the Phoenix office of the F.B.I at the email address above – YOU WERE/ARE VICTIMS in this case.

If you were a BUYER at SUNSCAPE Villas in Scottsdale and received CASHBACK after Close of Escrow – The F.B.I. knows WHO YOU ARE & the unit you purchased as well as the EXACT dollar amount you received CASHBACK (after close of escrow) complete with documentation of the account those funds were wired into.

Again, I believe the majority of the BUYERS were/are victims in this CASHBACK Fraud Scheme – BUYERS – COME FORWARD NOW so you don’t look like active participants and end up behind bars, sharing a cell with MOSER – PERRY – KING – LOW.

Comment by Ruth Lamb — June 20, 2008 @ 4:53 am
WARNING….TO THE OTHER INDUSTRY PROFESSIONALS that had actual knowledge/involvement in this CASHBACK Fraud Scheme (regardless of who told you it was LEGAL – it’s ILLEGAL) – The F.B.I. knows who YOU are too – I URGE ALL OF YOU to contact the F.B.I. at the email address below. Again, those that come forward on their own look less like active participants….

“THE F.B.I. SAID MORE ARRESTS ARE EXPECTED TO FOLLOW AFTER MORE COMPLAINTS COME INTO THEIR EMAIL ADDRESS AT” px_cashback@ic.fbi.gov

They have the names and involvement of 35 Industry Professionals as outlined below – You Know WHO You Are…
23 Licensed Real Estate Agents as follows:
– 1 Licensed in IL
– 2 Licensed in OH – purchased & received CASHBACK
– 20 Licensed in AZ – GREG MOSER & CHERYL KING plus:
– 10 Sales Center Agents/Staff & 8 Buyers(Referral)Agents
– 9 Agents purchased & received CASHBACK
2 Real Estate Appraisers – tied to HOUSE2HOME LENDING
– 1 Appraiser Purchased at LANDMARK on Central
1 Estate Planner – JAY PERRY
1 Unlicensed Assistant – Moser & Perry
1 Unlicensed Contract/Closing Coordinator – Urbis Properties
1 Unlicensed Marketing Director/Personal Assistant – Urbis/King
6 HOUSE2HOME Lending (OWNER, LO’S, PROCESSORS)
– 3 H2H personnel purchased & received CASHBACK

Comment by Ruth Lamb — June 20, 2008 @ 5:57 am
I purchased a condo at Landmark on Central back in 2006 and used House 2 Home for my financing. I did receive a significant amount of money as a buyer. I’ve asked my agent if my purchase falls under the Operation Cashback and she has assured me that it does not. How would I know for sure? I remember the sales velocity was quite high at Landmark when I bought, are all these purchases being scrutinized? Also, who is at fault at Landmark? Is it the listing broker? Is it the woman named Cheryl King that is mentioned in this blog (I remember her)? Is it the buyer’s broker? Mortgage broker? Developer? Thanks in advance for helping me better understand.

Comment by Anonymous One — June 21, 2008 @ 3:48 pm
Real estate 101- Any and all agreements between Buyer and Seller must be in writting and contained in the contract. This is a RESPA and lending guideline. ANY agent who ever attended their buyers closing (which a good agent takes the time to do) would be aware of this because your buyer is asked to sign a lender generated document at closing stating this. There is no excuse for any of these agents to say they didn’t know it was wrong….it is their job to know! From what I have heard the underwritters and title companies were withheld the documents with the agreement outlining the cash back or it would not have gone forward. So all the site agents, developer, broker for developer, broker for buyer are all responsible. The buyer was made aware at title when signing that notice from the lender but was probably told by their agent (if their agent was even there) that it didn’t apply to them. So they should be held at a lower standard of responsibility if at all, unless they are experienced investors or industry players. (FYI-I do not practice law) Just an opinion.

This blog unfortunatley sheds an ugly light on the real estate industry and it is unfortunate that the dirty laundry had to unfold for all to see. It would have been better, I think, that the FBI or Dept of R.E. did their thing, made their findings and busted the appropriate people and at such a time educated our consumers with the facts.

Ms. Lamb would be an asset to any company that cares about ethics or liability. I commend and respect her. I have had an opportunity to meet her. I do think her one mistake was blogging. Although I questioned it at first, I now think her motive was purely unselfish and she wanted to inform and warn consumers. It may have been better had she just filed with the appropriate agencies and left it at that. It looks like our industry is full of bottom feeders and it is not. There are plenty of ethical agents not motivated by greed who just want to make a decent living doing what they love. I know it’s true I see them everyday.

Comment by Anonymous — June 21, 2008 @ 6:18 pm
To Anonymous One – ANSWER to your question below:

I purchased a condo at Landmark on Central back in 2006 and used House 2 Home for my financing. I did receive a significant amount of money as a buyer. I’ve asked my agent if my purchase falls under the Operation Cashback and she has assured me that it does not. How would I know for sure?

If you purchased at LANKMARK, used HOUSE2HOME and received CASHBACK from the seller after close of escrow – YOUR AGENT IS LACKING KNOWLEDGE BECAUSE YOUR TRANSACTION IS UNDER INVESTIGATION BY THE FBI – I URGE YOU TO CONTACT THE FBI AT THE EMAIL ADDRESS BELOW – THEY WANT TO HEAR FROM YOU!

px_cashback@ic.fbi.gov

Comment by Ruth Lamb — June 25, 2008 @ 3:45 pm
Can anyone answer this? Everything I have read and understand about what Cheryl King and her connections did with purchases and loans, certainly seems illegal. As of two days ago, I heard Cheryl King WAS investigated by the FBI and they have cleared her of any wrong doing. What am I missing? How can she get away with this? Does anyone know if this is true or not?
Very Frustrating.

Comment by Frustrated — July 26, 2008 @ 12:18 pm
To frustrated:

The key question is WHO did you hear that from? She still has a lot of people buying into her lies. Unless you have heard it directly from the FBI – don’t believe it!!!

I have yet to hear that from the FBI – based on the documentation (emails from Cheryl – to ALL the involved, clearly outlining that she knew what the lender guidelines were, what could be shown on the HUD and exactly how they were going to go around those laws).

Last I heard from the FBI – mid June, those emails were pretty damning evidence against Cheryl, so at this point I’d be willing to bet the only chance Cheryl has of being cleared is via a jury of her peers, which won’t happen until the criminal indictments are handed down (which to my knowledge has not happened yet).
Again, until I hear differently from the FBI, it’s not a matter of IF, it’s a matter of WHEN.

FYI: Cheryl is still showing an active complaint filed against her Real Estate License, which I know for a fact is tied to this case, so if she had indeed been cleared of any wrong doing, that would no longer be showing on the DRE website.

To frustrated or anyone else with questions related to this case, feel free to contact me at rlamb222@cox.net and I’d be to talk with you off-line.

Comment by Ruth Lamb — July 28, 2008 @ 2:28 pm
To Ruth and anyone else who has tried to police our industry:

I wish you all the best of luck. I have been working with the FBI, IRS, DRE, the State Attorney General, the local authorities and individual victims of a large mortgage and real estate fraud scheme in the mountains of Colorado for almost two years. There has yet to be an arrest. The only folks feeling the pinch are the honest ones who have tried to help and have donated their time and expertise to do review appraisals and help with complaints.

I am convinced that until the law enforcement agencies take this seriously and educate themselves so that they can properly investigate this the only recourse the victims will have is through lawsuits.

Yes, these “bad guys” deserve to be in jail for a very long time, but it takes too long for the authorities to even start cracking down on them. Meanwhile, they have plenty of the the victims’ and lenders’ money to have a gay old time and to do their level best to show what upstanding citizens they are. They spread some of that money around to be sure to buy favor and cause doubt about their guilt. But for the most part they just keep doing what they are doing moving on to new subdivisions and new counties. Occasionally they change their name and morph different players into different roles, but the recipe stays the same.

The only way to stop them is for every RE Agent, mortgage broker, title closer, appraiser to stand up and say “NO, NOT ON MY WATCH!” But, alas, way too many of those same folks are the ones helping these criminals perpetrate the very scams that are now ruining our industry.

If you are not part of the solution, you are part of the problem!!

Real Estate Investors, if you don’t have the cash to put 30% or more down, the cash to do the repairs and the cash to sit on it for a few years to wait for real equity, then please get out of “flipping houses” and try your hand at the stock market or something where your gambles don’t ruin other peoples lives.

We need to all take the pledge, “First, do no harm!” and mean it.

Comment by inthesameboat — July 29, 2008 @ 2:11 pm
to inthesameboat some of these people own all the companys involved including the title company. and you are right people really don’t understand it.
Until it happens to them then they will do something about it?

Comment by Bob McNeilly — July 29, 2008 @ 2:19 pm
FROM MY VOICE TO GODS EARS!!!

My whole purpose for contributing to this BLOG was my belief that GOOD wins over Evil and hoping to join together those of us GOOD ONES to stand up and take a stand and flush out all of the BAD APPLES that are spoiling our industry.

REALTORS – LO’S – APPRAISERS: one phase to live by: CODE OF ETHICS!!! It IS part of YOUR – JOB DESCRIPTION!

Comment by Ruth Lamb — July 29, 2008 @ 6:24 pm
Well good luck to you, Ruith. I wish you more luck than I’ve had fighting evil. I suggest you watch your back. It’s increasingly difficult to tell the good guys from the bad.

Comment by Dawn McNeilly — July 29, 2008 @ 9:40 pm
Ruth,
Thank you for your response. I did not hear this first hand but according to Ms. Kings attorney, she has been cleared of all charges.

Comment by Frustrated — July 31, 2008 @ 10:59 am
Frustrated,
Next question… Did you hear that first hand from Cheryl Kings attorney or first hand from Cheryl?
Last I heard – as of yesterday…. the investigation is a very large one – continues to grow and is still very much ongoing…
Time will tell, but I’m still willing to bet that MOSER/PERRY/KING/LOW will be included in the next round of indictments handed down by the FBI & DOJ.

Comment by Ruth Lamb — July 31, 2008 @ 11:24 am
Thanks, Ruth. Rumor has it that it came from her attorney. First of all, as a veteran in the real estate industry I admire the leap you have taken here. Good things come to good people.

As speculation continues many have questioned the validity of your claims. How do you know so much when many of the individuals involved closely and at arms length haven’t heard a word yet from anyone? Who is confiding in you with the updates – like what you heard yesterday?

Also, are the several brokers that Cheryl worked for working with the authorities against her or are they being indicted as well? I would guess that they had knowledge of what she was doing, since they are responsible for her actions.

Have a nice day and I hope your search for employment is improving.

Comment by Frustrated — July 31, 2008 @ 1:14 pm
Frustrated,
If you contact me offline – rlamb222@cox.net
I’d be happy to share all of the information, my contacts and correspondence with the authorities – as you appear to be someone closely involved in this case that continues to be kept in the rumor loop that might be enlightened by the facts.

One thing that everyone needs to keep in mind, is that cases as large and complex as this one take a lot of time and manpower to investigate (some as long as 2 yrs). The 5+ cases here in AZ that were in the news in June, were (are) in line for indictments, arrests & prosecution prior to this case – but this case is being worked on and was what the FBI was referring to when it said in the news, there will be “more to come.”

As far as the Brokers that Cheryl worked for “working with the authorities against her or are they being indicted as well? I would guess that they had knowledge of what she was doing, since they are responsible for her actions.”

I can not speak for them, I can only assume that they are working with the authorities… they have done nothing wrong.

Yes, brokers are responsible for their agents actions – but in at least two of the brokers cases… they had NO IDEA of this program – it was purposely hidden from them as both myself and the other transaction coordinator in the office were told flat out (in a threatening tone) by Cheryl, that because this happened ‘outside of escrow’ the Broker & Title Company was not to know.

Comment by Ruth Lamb — July 31, 2008 @ 2:59 pm
Hello Ruth, Any update on the investigation of Urbis?

Comment by Frustrated — September 24, 2008 @ 1:41 pm
This is a very interesting forum. Its an unfortunate situation all around and I feel for Ruth, in trying to do the right thing in exposing something that is clearly if not illegal then at least very close the “line”. It is unfortunately a long term wait and see until all the facts come out.

What boggles the mind is that even in our financial crisis, broker agents and investment oriented organization s continue to push these questionable cash back investments.

One group called the Hanover Companies is fast becoming notorious for these cash back scheme, even in todays climate, praying on the uneducated investor.

Their are numerous posts on this site about Cay Clubs and the liberties that they took and where their investors wound up. Hanover is actively peddling these same questionable investments by partnering with desperate developers willing to game the system with inflated sales prices and manipulated incentives to force short term cash flow. These investors will be left holding the bag when investments incentives expire. The real end users who bought in these developments will also be hurt

I just spoke with one of their rep’s and I was amazed at the pitch. they claimed that they Hanover or actually their ceo named Jerry Guterman owns all these properties on their site. Yet when I asked local realtors to look up the ownership of the units in tax records, it was always in the developers llc name not Hanover Companies or Jerry Guterman.

Point is be careful folks , the con men are still out there actively selling today, even as our financial markets are collapsing because of just this kind of manipulation over the past few years.

Buyer Beware with these incentives if it sounds to good to be true it probably is!

Comment by Cash Back Mortgage Fraud — September 25, 2008 @ 6:28 pm
Dear Frustrated and anyone else looking for ‘Updates’ on Urbis.

Why don’t you ask Cheryl? After all, isn’t it you who said that everyone is questioning the validity of my claims and that per Cheryl’s attorney she has been cleared of any wrong doing? What’s going to happen when you all are faced with the truth – she lied!

The way I look at it… the longer it takes for the ‘validity’ of this case to come to light – it just means the list of charges against those involved is getting longer. I know exactly what I gave the authorities and that it was illegal (so does Cheryl, Moser and Perry).

For those of you close to the case that have yet to be contacted by the authorities and continue to believe the lies of Cheryl…. I almost feel sorry for you… I would be concerned if I were you and you have not yet (yourselves) contacted the FBI at the email address listed above…. They know who you all are – if they have not yet contacted you, chances are pretty good they could be building a case against you as well.

For anyone who wishes to come out of the shadows of the anonymous and want a true update, feel free to contact me at my email address I have listed above.

One last thing to frustrated… thanks for asking how things were going for me – I lose my home on 11.17.2008… as I have said before and I will say again, this whole ordeal might end up costing me my home, but (unlike others) it will never cost me my freedom – I will continue to enjoy the day to day time with my children and grand children.

Ruth

Comment by Anonymous — September 28, 2008 @ 1:48 am
Sorry, I always sign my name to my post – just hit the submit button a tad too fast. The post above is from me.
Ruth Lamb

Comment by Ruth Lamb — September 28, 2008 @ 1:51 am
Hi Ruth,

Thank you for your update and I do understand is has been very difficult for you, I’m certain I don’t understand completely but it does make me sad when someone is only trying to do what is right and their life gets turned upside down.
Trust me; my attitude toward Ms. King and the group is exactly the same as yours. I want to see anyone that has profited from others illegally, prosecuted to the fullest.
Ruth, just a thought, maybe you should post your resume on this blog where someone may be able to assist with your job search. I am certainly willing to start a fund to help you save your home?…Is that anything you would be open to?

Comment by Frustrated — September 28, 2008 @ 2:16 pm
Frustrated,

You suggest that I post my resume on here… are you kidding me? You won’t even post under your real name.

If you want to contact me off this blog, as your true identity not as Confidential Confidential under a newly created yahoo email account – then we can talk. I will not disclose your identity to the masses that read this blog, or anyone else unless it warrants disclosure to the investigators working on the case.

Starting a “Do the Right Thing because It Is the Right Thing to Do” or “Integrity” Fund could be a positive thing to do, not just for me, but for others that fit the criteria (through no fault of their own have found themselves in the same situation).

Through this whole ordeal, I have come across several people that have said that after watching what coming forward has cost me, they probably would not. They’d just keep their mouth shut, find another job, but probably not go to the authorites with the information of possible illegal activity – Which is not the right message that needs to be sent to our industry.

Ruth Lamb
rlamb222@cox.net

Comment by Ruth Lamb — September 28, 2008 @ 5:45 pm
Is there any new developments?

Comment by ??? — March 3, 2009 @ 7:06 pm
New Developments –

All data below obtained off of Maricopa County Tax Records

LANDMARK on Central has 12 properties that were purchased under the ‘Cashback after Close of Escrow’ that have since gone into Foreclosure or ShortSold.
Original ‘Fraud’ Loan Total: $2,873,315
REO-List/Sale Total: $945,950
Loss to Lenders: $1,927,365+

SUNSCAPE Villas has 5 properties that were purchased under the ‘Cashback after Close of Escrow’ that have since gone into Forclosure or ShortSold.
Original ‘Fraud’ Loan Total: $1,260,075
REO List/Sale Total: $590,000
Loss to Lenders: $670,075+

FOR A GRAND TOTAL OF:
17 ‘Fraud’ Loans: $4,133,390
REO List/Sale: $1,535,950
Loss to Lenders: $2,597,440+

plus: 6 currently pre-Forclosure original loan total: $1,342,230

Landmark has double the Sunscape numbers as they offered the ‘Cashback Incentive’ 6-8 months prior to starting it at Sunscape.

So far, 13% of the files I gave to the authories have defaulted causing loss to lenders and it’s early on in the ‘cycle’ –
I see the Ring Leaders (Moser/Perry/King/Low) restitution bill growing by foreclosure – ouch!

I know innocent until proven guilty – that’s the beauty of this case – not a matter of she said / he-she said… paper trails, bank accounts, recorded documents – don’t lie.

I was told going into this, that cases like this can take 18-24 months and sometimes longer to investigate… based on everything I provided them upfront, I was hoping it would not take as long. My first meeting with the AZ Dept of Financial Institutions was last week of Jan 2008 and my first meeting with the FBI was first week of March 2008 – so we are just 13 months into the process. I’ll say again as I have said before… the longer it takes – the bigger the case!

Ruth Lamb
rlamb222@cox.net

Comment by Ruth Lamb — March 20, 2009 @ 5:10 pm
Just wanted to give an update on me… now that I am on the other side of the trauma brought about by my decision to do the right thing and go to the authorities which ended up costing me my job and thus my home (Chase refused to work with me on my 212k loan because I was now being paid straight commission – but ended up selling the house for 157k – still don’t understand the logic in their thinking)…. but…..

Life is Good! I am happy & healthy!

Thanks to awesome friend that was in a position to purchase an investment property… I am not homeless….
and
I am working on one of the top Real Estate teams here in AZ as a Buyer’s Specialist – it’s straight commission, but it was time I took my own destiny in my own hands… the days of relying on others that I worked for my paycheck to do the right thing and operate their business legally is over.

My team leader is fully aware of my involvement in this case and applauds my decision to go to the authories and supports me 100%…. I am handed buyers left and right to work with… I am wiritng contracts and yes, closing LEGAL transactions (have one for 600k closing in a couple of weeks).

If you or anyone you know is looking to purchase property here in AZ and would like one of the most honest, ethical agents in the business representing you – feel free to contact me. It’s a great Buyers Market here with some amazing deals….

Ruth Lamb
ruthlamb@cox.net

ps…. another case here in AZ recently cleared the indictment stage so my case is moving up on the list….. and yes…. it is still a very active case with everyone involved hoping to make a big impact with its outcome

Comment by Ruth Lamb — April 24, 2009 @ 7:11 pm
Very interested in updates and outcome on this. Also, Andrew Waite is a crack up. He once called a friend’s property management company and asked “Do you know who I am? I can make or break your company,” after asking what kind of rates he could get for his own properties. Hilarious.

Comment by Anonymous — June 3, 2009 @ 4:44 pm
Greg Moser and Cheryl King do not have complaints against them. This is just a childish woman trying to get her 15 minutes. She was just upset Cheryl wouldnt allow her to move in to a sales position. This type of “the world owes me” attitude and “poor me” whining is why she was denied a position with public contact.

Comment by Anonymous — November 10, 2009 @ 8:38 pm
Rumor has it you lost your house because among other reasons, you lied on your loan application. Told the bank you made more than you really do. Isnt that fraud?
I have to agree with the last person. You spend all this time on lime complaining about what has happened “to you” … Its your own fault. if you wouldnt have poasted your dirty laundry on here, maybe you wouldnt have ruined your life, your kids life and your grandkids life. Take responsability for your own actions. Stop blaming the world for your bad choices. The way you treat people reflects in your own life. Ever heard of carma?

Comment by Anonymous — December 6, 2009 @ 12:13 am
Been awhile since I last commented on this case….wasn’t into people bashing me for going to the authorities and posting my case on here – knew time would tell the truth and I would have the last word!
The wheels of justice sometimes move slow – but they do indeed move…… all of you doubters out there, why not ask some of the main people involved in this case (moser/perry/king/low) – unless they are continuing their lying ways….they are ALL very much aware that this case is a REAL case and that they are indeed trouble…..only wish I could’ve been a fly on the wall when the search warrants were carried out……arrests and indicments are right around the corner!

Comment by Ruth Lamb — May 20, 2010 @ 4:02 pm
You are AMAZING Ruth! Justice is served!

Comment by Anonymous — May 20, 2010 @ 4:35 pm
Many of us have had to suffer the wrath of their deceitful ways and now karma has certainly come around to join the side of those who strive for good and fairness.

Comment by Anonymous — May 20, 2010 @ 4:37 pm
‘Right around the corner’ could mean weeks (hopefully not months) in FBI terms…. but just knowing that ALL of the main players have full knowledge that there is a very large federal case against them, brings me some peace of mind!

Comment by Ruth Lamb — May 20, 2010 @ 5:50 pm
hmmmmm…….wonder if the search warrants that were carried out on the main players in this case was to find the money……the restitution (loss to the lenders due to all of the foreclosures and shortsales of these properties) has got to be getting close to 4-5 million dollars by now…..

Comment by Ruth Lamb — May 20, 2010 @ 7:33 pm
Good news, Ruth. I hope justice isn’t far away for you.

Comment by Dawn — May 21, 2010 @ 5:39 pm
While I believe Ruth did the right thing, I think it was all done for the wrong reasons. If she was truly out just to “do the right thing” why has she “published” the whole thing? You do the right thing because its RIGHT… not to get attention.
I know someone who worked with her at Sun Scape and she says Ruth is calling everyone, posting things on twitter, facebook and other places. She is even telling random people she runs into. She again is just out for the attention.
I really do respect her doing the right thing. But I think the way she has done it, is extremely disrespectful. Stop bragging about being a “good person”… Who are you trying to convince you are “good”? Yourself? If you must announce your accomplishments, you are not accomplished.

Comment by KSP — May 21, 2010 @ 8:07 pm
I “published” this whole thing on here so that those buyers, sales staff, etc…. that were unknowingly a part of this had a place to go and get information (yes my version of the truth)…..I was up against people that were continuing to tell everyone that they had done nothing wrong….(nice to see my version of the truth has turned out to be pretty spot on!)

I am calling everyone??? – hmmm…..telling random people???? – hmmm…..NOT SO!….. Have I called a few people that were very much involved with this and me at Sunscape to let them know what was going on – YES! Everyone has been wondering what was going on with this, afterall, it has been 2.5yrs…..

Yes I made a post on my facebook (with is private, you have to be a friend to view what I have posted) – 95% of the people on my facebook are personal people in my life that know the struggles that I have been through over the past couple of years and wanted to let them all know in one posting that it is all about to come to an end….sorry but I don’t do twitter and and not sure what other places you may be speaking of….

Out for attention???? hmmmm – maybe some positive reinforcement……Not a single person out there understands the magnitude of what I have been through over the past 2.5yrs and all that this ended up costing me….so until you have truly walked in my shoes – you have no right to judge my actions/reactions!

Comment by Ruth Lamb — May 21, 2010 @ 9:56 pm
TO KSP
Don’t criticize another person’s work until you’ve tried to do it yourself; don’t judge another person’s life until you’ve been forced to live it.

If I were Ruth I would rent a plane and write it in the sky. After all that she has been through, who are you to judge?

Comment by Anon — May 22, 2010 @ 1:23 am
Not that it matters… But I have walked in her shoes. I turned in a family member for a high profile white collar crime in another state. It broke up my family. I lost my husband. I lost my home. I have paid my price as well.
The difference is, I didnt throw my name on the internet telling my story of woes and expect sympathy. I didnt solicit kudos. I didnt expect the public to pat me on the back. I stood my ground privately.
I am proud of what I did, and I would do it again. I question myself everyday, when I look at my son, if it was all worth it… but I sleep well at night knowing I did the right thing. Like I said, more than once, I respect what Ruth did. It took courage. (I know HOW MUCH courage it takes) I just dont respect her need to be in the limelight while doing it. She could have done the exact same thing without spending so much time turning THE “story” in to HER story.

Comment by KSP — May 22, 2010 @ 2:50 am
You should be proud of that! I don’t believe Ruth published this story to pat her own back. It was probably to warn people of these crooks. This whole process took YEARS, think of how many people she has saved from trusting their savings/retirement to this group.

Comment by Anon — May 22, 2010 @ 10:42 am
I agree. Telling our story is about saving others from the same fate, there’s certanly no glory in admitting you’ve been ripped off.

Ralph Kept up your GREAT work

Comment by Dawn — May 22, 2010 @ 11:58 am
KSP – turning in a family member had to be difficult, good for you standing up and doing the right thing! You chose to do it privately, which had this been a family thing – I possibly would’ve done it a little more privately as well…..

I did not post my story on here until after my first meeting with the authorities and they had confirmed that this WAS illegal. At that point I felt it was my duty to get this story out. It had been going on for two years, they already had 150 plus people (including some in the industry) believing that what they were doing was totally legal as they had already bought into it one way or another. Then there were the countless numbers of others that were putting their own spin on it and starting to roll it out at other locations – I got word that this type of program was being offered in other states as well…..I doubt (moser,perry,king,low) were the ones who came up with this program on their own, they most likely heard about it from someone, someplace else that had been doing it successfully and decided to roll it out themselves.
The longer everyone kept their mouth shut the longer these deals continued to take place, we’re talking about hundreds and hundreds of deals – at some point someone had to stand up and yell – FIRE!!!!! There were TONS of people involved at this point with these types of transactions taking place nationwide.

Yes I had choices both on here and with the authorities – I could remain anonymous…. What was the point of remaining anonymous, at that point the parites involved knew I had turned them in – the gossip and rumor mill was running like wildfires…. Ruth did this….. Ruth said that……. I knew I was going to suffer the fallout and I made the decision not to suffer in silence….this forum gave me the avenue to set the record straight!

In 2007 when they first rolled this program out at my community, my gut told me this wasn’t legal – I searched the internet looking for something, some documentation, anything to tell me one way or another – I could find nothing definitive as they had put their own spin on it trying to make it appear legal….

My hope in going public was that somewhere, there was a ‘Ruth’ or a ‘Joe Buyer’ hearing about a program like this being offered and they were questioning the legalities and they searched the internet (such as I did 3.5yrs ago) and they find this story – yes they even find me, a real person that they can contact off line for additional information and possible guidance (yes, in 2.5yrs that has happened several times). Then they do their part in not participating and going to the authorities if warranted.

I wish I would’ve had someone to guide me in such a way before the first transaction had closed – my story would’ve been a lot different……I still would’ve gone to the autorities, but would’ve been able to do it privately.

Ruth Lamb

Comment by Ruth Lamb — May 22, 2010 @ 1:24 pm
So…are there any updates? Last post was in May? It does seem odd that it has been 2 or 3 years and there have not been any repercussions for these agents and lenders? the last report says there were search warrants? do these people still have licenses? Ruth, I think you did a very brave and heroic thing in trying to expose these bad actors. If more people had acted on reasonable ideas of what was “right” and “wrong” back in 2005 & 2006 we probably would not have 2/3rds of all homeowners in this area now underwater on their homes. But why are the feds doing nothing?

Comment by wondering — September 9, 2010 @ 11:17 pm
So… I guess the feds gave up and there will not be any justice for Ms. Lamb or the homeowners who bought at sunscape and landmark? Where was Ms. King’s broker when she was doing this?

Comment by agent in az — September 22, 2010 @ 12:13 am
Have you ever thought about writing an ebook or guest authoring on other sites? I have a blog based upon on the same topics you discuss and would love to have you share some stories/information. I know my viewers would enjoy your work. If you’re even remotely interested, feel free to shoot me an e mail.

Comment by apartment inspector yonkers — May 1, 2011 @ 8:53 am
Apartment Inspector Yongers,
Please contract me directly at rlamb222@cox.net
Thanks!
Ruth Lamb

Comment by Ruth Lamb — May 1, 2011 @ 11:34 am

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