Alan David Tikal, 46, of Brentwood, California, was convicted yesterday on 11 counts of mail fraud and one count of money laundering in a mortgage fraud scheme through which he stole $5.8 million in fees and monthly payments from struggling homeowners.
According to evidence presented at a one-day bench trial, Tikal operated a business known as KATN and falsely claimed to be a registered private banker between January 2010 and August 2013.
Tikal and his associates targeted struggling homeowners, most of whom did not speak English, and promised to reduce their outstanding mortgage debt by 75% in return for various fees and payments. The homeowners were told they would then owe new loans to Tikal that would only be 25% of the original loan.
More than 1,000 homeowners in California and other states were convinced by Tikal and his associates to participate in the program. As a result of relying on the program, many of these homeowners stopped payments on their existing mortgages and lost their homes to foreclosure.
There was not a single instance in which a homeowner’s debt was paid, forgiven or otherwise extinguished as a result of the mortgage relief program, according to a release from the office of Special Inspector General for the Troubled Asset Relief Program (SIGTARP), Christy Romero.
The SIGTARP press release reports that Tikal took $5.8 million from homeowners. More than $2.5 million of that amount was paid into accounts controlled by Tikal and his family.
“Tikal exploited the financial crisis by setting out to hurt others and profit from that hurt, and he accomplished his mission through his crime,” said Romero.
Romero added that even after Tikal had been arrested, he continued to run the scheme that fraudulently stalled foreclosure proceedings by TARP banks from inside his prison cell.
“The financial crisis that hit our communities so hard made it very difficult for many of our citizens to make ends meet,” said U.S. Attorney Benjamin B. Wagner. “Alan Tikal cynically took advantage of their desperation for his own profit, stealing payments meant to preserve family homes. We are gratified by the Court’s guilty verdict.”
Tikal awaits sentencing in December. He faces a maximum statutory penalty of 30 years in prison and a $1 million fine.
Co-defendants Tamara Tikal and Ray Kornfeld previously pleaded guilty and are also awaiting sentencing.