Federal Agents Apprehend 18 Defendants from Throughout Bay Area

SAN FRANCISCO—Today 18 individuals were apprehended on mortgage fraud-related charges, United States Attorney Joseph P. Russoniello announced. Over the last few months, a federal grand jury in San Francisco indicted these individuals on charges relating to alleged mortgage fraud schemes perpetrated between 2005 and 2009. The indictments were unsealed this afternoon after the defendants were arrested and made their initial court appearances before United States Magistrate Judge Bernard Zimmerman.

Of the 18 individuals charged, seven are charged with bank fraud, 10 are charged with conspiracy to commit mail fraud, and one is charged with conspiracy to commit wire fraud. According to the indictments, each defendant charged with bank fraud is alleged to have participated in a scheme to defraud financial institutions and lenders to obtain money from those entities by making materially false and fraudulent misrepresentations. The defendants charged with conspiring to commit mail fraud are charged with participating in a scheme to defraud financial institutions and other lenders by knowingly and intentionally submitting false and fraudulent information to those lenders to obtain loans for various borrowers.

Those charged and arrested include at least three current or former bank employees, eight real estate agents licensed by the California Department of Real Estate (DRE), and one mortgage broker licensed by the DRE. (The DRE’s website, which lists current and former licensees, can be found at www.dre.ca.gov.) The current or former bank employees include: Ciu (“Carrie”) Du (employed at Washington Mutual during the pertinent time frame, now employed elsewhere); Marilyn Infante (employed at Washington Mutual during the pertinent time frame, now retired); and Joseph John Pugliese (employed at Countrywide Home Loans during the pertinent time frame, now employed elsewhere).

The following is the list of defendants arrested today, as well as each defendant’s age, residence, whether and what type of license they have been issued by the DRE, and what charge each defendant is facing:

Norberto (“Noli”) AGUSTIN Conspiracy to Commit Mail Fraud

John Randolph Errazo BERNABE Bank Fraud

Sam BOWLEY Bank Fraud

Vangeline S. BROYLES Conspiracy to Commit Mail Fraud

Roy CERVANTES Conspiracy to Commit Mail Fraud

Maria COMFORT Bank Fraud

Jeanie S. CUSING Bank Fraud

Ginger DANIELS Bank Fraud

Ciu DU Bank Fraud

Marilyn INFANTE Bank Fraud

Cleofe Soledad NOGAVICH Conspiracy to Commit Mail Fraud

Wilfredo C. PASCUAL Conspiracy to Commit Mail Fraud

Leonora POMAR Conspiracy to Commit Mail Fraud

Joseph John PUGLIESE Conspiracy to Commit Mail Fraud

Wazhma (“Nilo”) RAHIMI Conspiracy to Commit Mail Fraud

Clarin TAMBOT-QUERIMIT Conspiracy to Commit Mail Fraud

Ricardo TANG Conspiracy to Commit Mail Fraud

Gina TCHIKOVANI Conspiracy to Commit Wire Fraud

The maximum statutory penalty for bank fraud, in violation of Title 18, United States Code, Section 1344, is 30 years of imprisonment, a $1,000,000 fine, five years of supervised release, and restitution. The maximum statutory penalties for conspiracy to commit mail/wire fraud are the same as those for bank fraud. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, Title 18, United States Code, Section 3553.

The prosecution is the result of a seven-month investigation by the Federal Bureau of Investigation, the United States Postal Service, and the United States Department of Housing and Urban Development, Office of Inspector General. Several Assistant United States Attorneys are prosecuting these cases.

These mortgage fraud cases are being prosecuted federally as part of President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

According to U.S. Attorney Russoniello, the criminal conduct these defendants are accused of engaging in, i.e. obtaining or using false documents to submit to lenders, exaggerating income and assets, understating liabilities, providing false employment records, and/or false banking information, was all too common during the years 2005-2009. Agents of the Financial Fraud Enforcement Task Force are pursuing a substantial number of leads in other similar matters that are expected to result in the filing of criminal charges against other individuals in the near future.

If you have information relating to potential mortgage fraud or other financial fraud, please call 415-553-7400.

Please note, indictments contain only allegations against individuals and, as with all defendants, these defendants must be presumed innocent unless and until proven guilty.

Michael Chou was sentenced today to 21 months in prison and ordered to pay $360,800 in forfeiture as a result of his conviction for conspiring to commit wire fraud, United States Attorney Joseph P. Russoniello announced.

Mr. Chou pleaded guilty to the wire fraud conspiracy charge on October 30, 2009. In pleading guilty, Chou admitted that from in or before 2003 until approximately April 2009, he participated in a scheme to defraud mortgage lenders and financial institutions by providing false and fraudulent information in support of mortgage loan applications. Working for San Francisco, Calif., based company known as “United Investments,” Chou and his co-conspirators assisted individuals who wanted to obtain mortgages from mortgage lenders so they could purchase residential properties in the Northern District of California and elsewhere.

As a part of this scheme, Chou routinely transmitted fraudulent loan applications to mortgage lenders that contained false employment information and false and inflated income and bank account information. The information was intended to inflate the borrowers’ creditworthiness. In addition, the loan applications were supported by false and forged documents that purported to verify the borrowers’ employment, income, and assets. Chou and other members of the scheme used a network of co-conspirators who agreed to pose as the borrowers’ employers and to falsely verify to the mortgage lenders the accuracy of the employment and income information listed on the loan applications. As a result of Chou’s participation in this conspiracy, he illegally earned at least $360,800.

The sentence was handed down by U.S. District Court Judge Susan Illston. Judge Illston also sentenced the defendant to a five-year period of supervised release. The defendant will begin serving the sentence on July 30, 2010.

Twelve other defendants have been charged in connection with the mortgage fraud scheme related to United Investments. Jeffrey Rabkin and Jeffrey Finigan are the Assistant U.S. Attorneys who are prosecuting these cases with the assistance of Elizabeth Garcia and Rayneisha Booth. The prosecutions are the result of an investigation by the Federal Bureau of Investigation.