Jeanetta Standefor Sentenced to 12 Years in Federal Prison for Real Estate Fraud
The promoter of an $18 million real estate investment scheme that targeted African-American individuals in Southern California and other states was sentenced today to 151 months in federal prison. Jeanetta M. Standefor, a 40-year-old resident of Altadena, California, was sentenced in Los Angeles federal court by United States District Judge Percy Anderson. In addition to the prison term, Judge Anderson ordered Standefor to pay $8,688,924.
Through her Pasadena-based company, Accelerated Funding Group (AFG), Standefor operated a bogus “foreclosure reinstatement” program that attracted more than 600 investors between 2005 and 2007. The scheme purported to use investors’ funds to cure defaults on distressed properties about to be put into foreclosure. While soliciting investor money and promising returns of up to 50 percent in time periods as short as one month, Standefor and AFG were instead operating a Ponzi scheme that used money from new investors to pay previous investors.
Jeanetta Standefor pleaded guilty in September 2008 to two counts of mail fraud.
Standefor’s case involved what is commonly called “affinity fraud,” that is, a fraud directed at a particular community. Jeanetta Standefor and AFG targeted investors in the African-American community through a now-defunct Web site, word of mouth, real estate seminars and testimonials by other seemingly successful African-American investors.
Standefor claimed investor funds would be used to assist owners of distressed properties. Written materials put out by AFG touted its foreclosure reinstatement program as “virtually risk-free” and promised investors that their principal would be safely returned within 72 hours at their request. However, Standefor and AFG did not use investor funds to cure defaults on any residential properties, and investors’ requests for return of their investments were ignored.
Jeanetta Standefor used more than $1.9 million of investor funds for personal expenses, such as her lavish wedding and honeymoon, cars, jewelry, tickets to entertainment events and home renovations.