The supposed ringleader of a massive mortgage modification fraud scheme pleaded guilty earlier this week to charges that he and others conspired to defraud struggling homeowners by falsely promising mortgage loan modifications they did not actually provide.
According to the U.S. Attorney’s Office for the District of Connecticut, Aria Maleki joins Mehdi Moarefian, who is also known as “Michael Miller,” and Daniel Shiau, who is also known as “Scott Decker,” in pleading guilty to charges stemming from a scheme that resulted in more than 1,000 homeowners suffering losses of more than $3 million total.
Moarefian and Shiau pleaded guilty last month to their involvement in the scheme that included the group operating a series of California-based companies that falsely purported to provide home mortgage loan modifications and other consumer debt relief services to numerous homeowners in Connecticut and across the United States in exchange for upfront fees.
And now, Maleki has pleaded guilty as well.
According to court documents, the group did business under at least 30 different company names, including several that closely resembled the names of legitimate businesses in the mortgage finance space, most notably Green Tree Servicing and Nationstar Mortgage. For instance, company names included Green Tree Financial and Nation Star Financial.
Court documents showed that the group also did business as First Choice Financial Group, Inc., First Choice Financial, First Choice Debt, Legal Modification Firm, National Freedom Group, Home Care Alliance Group, Home Protection Firm, Hardship Center, Network Solutions Center, Inc., Premiere Financial Center, Premiere Financial, Rescue Firm, International Research Group LLC, Hardship Solutions, American Loan Center, Loan Retention Firm, Clear Vision Financial, Enigma Fund, Inc.,“National Aid Group, Southern Chapman Group LLC, Save Point Financial, Best Rate Financial Solutions, and Nation Star Fin Group.
According to court documents, the group cold-called homeowners and offered to provide mortgage loan modification services to those who were having difficulty repaying their home mortgage loans.
Homeowners were charged fees that typically ranged from approximately $2,500 to $4,300 for their services.
In order to induce homeowners to pay these fees, the group made a series of false representations, including: stating that the homeowners already had been approved for mortgage loan modifications on “extremely favorable” terms; stating that the mortgage loan modifications already had been negotiated with the homeowners’ lenders; stating that the homeowners qualified for and would receive financial assistance under various government mortgage relief programs, including the Troubled Asset Relief Program and the Home Affordable Modification Program; and promising that if, for some reason, the mortgage loan modifications fell through, the homeowners would be entitled to a full refund of their fees.
But, the homeowners had not been pre-approved for mortgage loan modifications with lenders, mortgage loan modifications had not been negotiated with the lenders, homeowners had not qualified for and did not receive any financial assistance through government mortgage relief programs, and homeowners did not receive a refund of their fees upon request.
According to the U.S. Attorney’s Office, Maleki presided over the entire structure of this scheme, and pleaded guilty to one count of conspiracy to commit mail and wire fraud, an offense that carries a maximum term of imprisonment of 20 years.
Maleki also agreed to pay restitution of approximately $3 million. Maleki’s sentencing is scheduled for June 14, 2016.
Maleki also has agreed to forfeit approximately $350,000 that investigators seized from various bank accounts, approximately $362,000 seized from a Bitcoin account, a $100,000 cashier’s check, and a 2013 Ferrari 458 Italia, which carries a Kelly Blue Book suggested retail price of approximately $245,000.