HONOLULU, HI—Two indictments of 13 Oahu residents and one from the state of Washington on mortgage fraud related charges were unsealed today with the arrests of 10 of the 14 defendants. A federal grand jury had returned the indictments on August 11, 2010, but they had remained sealed until today. One indictment charged 10 defendants in 56 counts of conspiracy, wire fraud, and false statements on loan applications, while the other named four defendants in 33 counts of the same nature. The 14 named defendants are:

* ESTRELITA “ESTHER” GARO MIGUEL (58)
* JENNIFER GARIN MIGUEL (29)
* YOLIE CASTILLO TIBURCIO (36)
* VINAH CERIALES MORALES (45)
* GERALDINE GARIN MIGUEL LUKELA (33)
* TERESITA “TESSIE” FAELDONEA SORINO (33)
* MARY ANN LAPENIA (57)
* STEPHEN ELMER CALLO (59)
* FELICIDAD “FELICIA” TABALBAG CORPUZ (60) (Washington)
* ALBERT LONOIKAUAKINI JOY (45)
* ATLANTICA KAHAUNANI “NANI” TANUVASA (37)
* LENE TANUVASA, JR. (40)
* SAMANTHA MICHEL (37)
* MICHELLE LEE MALULANI KAMA (39)

Florence T. Nakakuni, United States Attorney for the District of Hawaii, said that according to the indictments, the purposes of the conspiracies and fraud schemes were to defraud lending institutions and others by submitting loan documents containing false information. The two indictments allege that certain defendants recruited individuals to apply for mortgage loans and to sign loan documents containing false representations, and that some defendants were loan officers who submitted fraudulent loan applications. In reliance on the false statements, the lending institutions funded the loans, and some of the defendants then distributed the loan proceeds, as well as collected their standard fees and commissions.

For the conspiracy count, the defendants face a maximum period of imprisonment of five years and a maximum fine of $250,000. For the wire fraud counts, the defendants face a maximum period of imprisonment of 20 years and a maximum fine of $250,000. For the false statement on loan application charges, the defendants face a maximum period of imprisonment of 30 years and a maximum fine of $1,000,000. Charges in an indictment are merely accusations, and each defendant is presumed innocent unless and until proven guilty.

At arraignments today, trial dates were set for October 13, 2010, for the 10 and four defendant cases before Chief United States District Judge Susan Oki Mollway and United States District Judge J. Michael Seabright, respectively.

The case resulted from an investigation by the Federal Bureau of Investigation and Internal Revenue Service – Criminal Investigation Division. The prosecution is being handled by Assistant United States Attorney Clare Connors.

While members of Congress, President Bush, and the Treasury Department attempt to work out (pun intended) the $700 billion Troubled Asset Relief Program, real estate and mortgage fraud continues to be the fastest-growing white collar crime in American:

WaMu loaned millions to California home flippers convicted in fraud scheme: Records show WaMu, America’s largest savings and loan, financed at least 43 mortgages worth $24.5 million on properties bought and sold by members of the Soni family since 2007. Of the 22 homes sold in that period, at least six have become problems for WaMu: Four were foreclosed, one received a notice of default and another was listed for sale at a $260,000 loss. Total value of WaMu’s mortgages on the troubled properties: $2.7 million.

Weld County’s ‘Most Wanted’ fugitive — a developer — busted in Mexico: Weld County’s “Most Wanted” fugitive sits in a California jail today after a dogged investigation led to his arrest in Mexico. Mark Strodtman, a Greeley developer, was indicted March 25 by Weld County grand jury on 23 felonies, including racketeering. Strodtman, 51, and two others are accused in a mortgage fraud scheme that left many Greeley area families in foreclosure, reduced property values of neighboring homes and defrauded lenders, according to the Weld County District Attorney’s Office.

Brothers admit to million-dollar mortgage fraud: Federal prosecutors say two Virginia brothers have pleaded guilty in a million-dollar mortgage fraud scheme. Twenty-nine-year-old Mohammed Rababeh of Vienna and 31-year-old Ahmed Rababeh of Haymarket pleaded guilty Wednesday to conspiring to commit bank fraud.

Former mortgage loan officer pleads guilty to fraud scheme: A 25-year-old woman pleaded guilty in federal court yesterday to participating in a mortgage fraud scheme and faces up to five years in prison and $250,000 in fines. Paula Galacgac admitted that, while working as a loan officer for Mortgage Ability, LLC she recruited two “straw buyers” for properties on O’ahu and assisted them in fraudulently applying for mortgage loans worth more than $400,000. Other members alleged to be part of the fraud conspiracy were named in a separate criminal indictment returned by a federal grand jury May 30.

Officials say Florida man is part of mortgage scheme: A Seffner man was arrested Wednesday in connection with a multimillion-dollar mortgage fraud scheme that victimized dozens of people since 2004, the Florida Department of Law Enforcement said. Michael Fetterhoff, 37, of 205 Kingsway Road, was charged with grand theft of more than $100,000. Fetterhoff worked in sales for Advanced Mortgage Solutions, a mortgage broker company associated with other home improvement businesses that persuaded mostly minority customers in poor areas of Florida to take out home loans, FDLE spokeswoman Trena Reddick said.

Kansas City mortgage fraud ringleader sentenced to 13 years: A Kansas City businessman was sentenced to 13 years in prison for a $17 million mortgage fraud scheme that included buying a home owned by former Jackson County Executive Katheryn Shields and her husband. Raymond Zwego Jr. will also pay nearly $5.6 million in restitution and serve three of those years in prison for a probation violation.

AARP Calls For Help For Victims of Mortgage Fraud: Florida is one of only three states that doesn’t offer financial protection to victims of fraudulent loans. We’re also first in the nation for mortgage fraud. The Florida Association of Mortgage Brokers and AARP are calling on lawmakers to revive the Mortgage Brokerage Guaranty Fund. The fund was quietly cut in the 90’s. It would pay some victims or mortgage fraud 20,000 dollars for their losses. AARP Spokesman Dave Bruns said if the program hadn’t been canceled, today the state would have 24 (m) million dollars to help victims.

Delray Beach mortgage agent guilty of fraud: A Delray Beach mortgage broker pleaded guilty Friday to participating in a wire fraud scheme to misappropriate more than $1.2 million in client funds supposedly held in escrow for real estate transactions and related expenses. John Mohan, 38, faces up to 20 years in prison when he is sentenced Dec. 19 in federal court. According to the U.S. Attorney’s Office, Mohan worked as a mortgage broker and closing agent. He collected money from buyers and lenders and represented to the parties that the funds were being held in escrow to be disbursed for various specified purposes, including the satisfaction of pre-existing mortgages. Prosecutors said Mohan used the money for personal use and investments and tried to conceal the fraud and prevent immediate foreclosure of the property by sometimes making payments on the homeowner’s original mortgage.

Virginia mortgage broker sentenced in real estate fraud scheme: A mortgage broker from Norfolk has been sentenced to four years in federal prison in a mortgage fraud case involving a home in northern Virginia. Fifty-year-old David A. Freelander was sentenced last Friday in Alexandria federal court. He has to pay more than $5.4 million in restitution.

Florida AG suing 10 companies, 15 individuals for mortgage fraud: Florida Attorney General Bill McCollum announced last Friday that his state’s Mortgage Fraud Task Force is suing 10 companies and 15 individuals for their alleged roles in a Central Florida mortgage fraud scheme. The suit alleges that the group obtained more than $37 million in mortgage loans for at least 60 homes and siphoned off more than $6 million of the loan proceeds for their personal use.

12 indicted in Atlanta mortgage fraud scheme: Local authorities said last Monday they charged 12 men with an elaborate mortgage fraud scheme in Atlanta’s West End neighborhood and seized more than $200,000 of assets. In indictments filed last week, Fulton County District Attorney Paul Howard Jr. accused the men of buying and selling nine homes using false appraisals that were more than double the homes’ actual value. Seven of the houses were in the 30310 zip code in the West End, where 26 homes were put up for foreclosure auction in late June.