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November 3, 2012

Woman Who Organized $20 Million Mortgage Fraud Scheme in Southern California Pleads Guilty in Oregon Federal Court

Filed under: California Defense Attorney — Tags: , , — fayarfa @ 10:27 am

A former Southern California resident pleaded guilty today in federal court in Portland, Oregon to mail fraud charges for orchestrating a mortgage fraud scheme that used fraudulent loan applications and supporting documents to convince lenders to fund more than $20 million in loans on approximately three dozen properties in Orange, Riverside and San Bernardino Counties.

Wanda Coleman, 59, a former resident of Pauma Valley who now lives in Glenoma, Washington, pleaded guilty to one count of mail fraud pursuant to a plea agreement filed under seal in United States District Court in Portland. As a result of today’s guilty plea, Coleman faces a statutory maximum sentence of 30 years in federal prison when she is sentenced on January 25, 2013 by United States District Judge Michael H. Simon.

The case against Coleman was brought by the United States Attorney’s Office in the Central District of California following an investigation by the Federal Bureau of Investigation. The case was transferred to the District of Oregon, which is near Coleman’s new residence, for the entry of the guilty plea and sentencing.

According to court documents, Coleman and several co-conspirators fraudulently obtained funds from financial institutions by making false statements on, and omitting material information from, loan applications submitted to purchase houses in the names of “straw buyers.” Coleman identified properties for sale across Southern California and offered to pay the sellers substantially more than their asking price, in return for the sellers’ agreement to refund the excess amount to Coleman or companies that she controlled. Coleman recruited straw buyers to submit fraudulent applications for loans to buy the houses. Various participants in the scheme prepared fraudulent mortgage applications that contained false information regarding the buyers’ employment, income and assets, and then submitted the bogus applications to lenders. To corroborate the false claims, co-conspirators forged bank statements and prepared other fraudulent documents, which were submitted to lenders.

As a result of the scheme, financial institutions funded loans totaling more than $20 million in relation to approximately 30 properties across Southern California. The straw buyers ultimately defaulted on the loans, resulting in foreclosure of the properties and losses of more than $11 million to the lenders.

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