The former owner of a California foreclosure rescue firm admitted in court last week to stealing struggling borrowers’ homes during the housing crisis.
Sergio Barrientos pleaded guilty last week to conspiracy to commit wire fraud affecting a financial institution and bank fraud.
According to court documents, from about September 2004 through February 2008, Barrientos and co-conspirators Zalathiel Aguila and Omar Anabo operated a business in California called Capital Access.
The company offered a “Keep Your Home” program that targeted struggling borrowers who were nearing foreclosure. The program supposedly offered a temporary rescue plan in which “qualified investors” would take over the borrowers’ mortgage while the borrower paid rent and worked on rebuilding their credit.
But that’s not what actually happened.
According to court documents, Barrientos, Aguila, and Anabo convinced the struggling borrowers to sign away the titles to their homes, then spent any equity those homeowners had saved.
Then, Barrientos, Aguila, and Anabo used straw buyers to defraud financial institutions out of millions of dollars in loans obtained under false pretenses.
The equity taken from the distressed homeowners’ properties was then used for operational expenses of the scheme and Barrientos and his co-conspirators’ personal expenses.
According to the U.S. Attorney’s Office, a number homeowners across California lost their homes and savings as a result of the scheme, while the affected lenders lost an estimated $10.47 million from the fraud.
Barrientos is scheduled to be sentenced later this year and faces a maximum statutory penalty of 30 years in prison and a $1 million fine.