Mortgage fraud suspect indicted on 29 counts

February 8, 2011 7:14:57 PM PST
A Las Vegas man has been arrested on a 29-count indictment of defrauding residents of Alameda County in a mortgage rescue scheme. 7 On Your Side has been conducting an investigation of its own into the accusations for two months.

This case was troubling because many of the homeowners who got involved with the scheme truly believed they were getting help. However, the indictment accuses the suspect and three associates of doing the exact opposite.

A home on a four-acre lot in Brentwood was supposed to be Pat -- who asked us not to use her real name -- and her family's dream home, but the recession hit their contracting business hard and the home went into foreclosure. Then a friend approached them about a program that she said would save their home.

"Of course, I was very excited. Any opportunity to try and save our land, basically is something that we were interested in doing research and looking into," said Pat.

She said a webinar produced by the PC Marketing Team practically guaranteed it would work.

"Like we saw earlier in the past -- 95 percent success ratio. The ones we have now are even higher than that, which is quite exciting, but we now have aligned ourselves with a group of private bankers that represent us the homeowners as well as private banks," said Brandon Le, the webiner host.

In the webinar Le explained private bankers would buy Pat's mortgage from the bank and sell it back to her at a 75 percent savings.

"They're buying your loan, supposedly at a discounted rate from the bank, then they're conveying it back to you at a discount, using bank credits and tax credits so they aren't actually losing money," said Pat.

The Alameda County District Attorney's Office said there is one basic problem with the scheme -- it doesn't work.

"The allegations are they conspired to commit a real estate fraud scheme in which they offered to save the victim's homes from foreclosure, in fact were not doing that, but in fact, they were just filing false documents under the false promise of saving the homes," said Alameda County Deputy District Attorney David Lim.

The Alameda County grand jury has handed down a 29-count indictment against Alan David Tikal, who is doing business as KATN Trust. Tikal alone faces all 29 counts and is under arrest in a Las Vegas jail. If convicted, he could get nearly 22 years in prison for real estate fraud, mortgage security fraud, and filing false documents. Three other individuals face similar charges, but far fewer counts. Those three are Bruce Blankenhorn, who faces seven felony counts, Luis De Leon, who faces three felony counts, and Linda Voss, who faces one felony count. The host of the webinar and the PC Marketing Team were not indicted.

Tikal's attorney, Keen Ellsworth, called the charges ridiculous and said, "The charges aren't substantiated by any evidence we've seen. We know of no banks that ever complained."

"The larger problem is that the homeowners by signing up for a program that doesn't work, stand to lose their home in foreclosure when they stop paying their original loan," said Lim.

A check of property records found that along with Tikal a company called CAA Inc. out of Las Vegas has also been involved in these transactions. CAA services the loans and paperwork. It was not named in the indictment.

Merre Ward has worked in real estate for more than two decades. She said a lot of people have asked her about this foreclosure rescue program in recent weeks.

"It's very sad, because they're going to end up in a worse situation than when they started," said Ward.

The grand jury indictment lists the homeowners of 10 homes in Alameda County who officials say were defrauded. At least two are in Hayward, including one unit in the Mannon Park townhome complex, three of the homes are in Oakland, two are in Fremont, and the others are in Union City and Berkeley.

Four of the homeowners we reached said they weren't sure they were being schemed. Two declined to talk to us. All paid what the contract called a donation of $1,500 to $3,500 to CAA Inc. Merre advises any of her clients who ask to stay away from this program.

"They don't want to believe what I have to say, but they will do more investigating of their own," said Ward.

In the end, Pat took Merre's advice.

"I don't know if I'd go ahead with it now, but two, three weeks ago, I might have," said Pat.

The Oregon Department of Justice confirms that this summer it ordered Tikal to repay $5,000 to four victims. The department has since referred the matter to its criminal division. Also last year, the Office of the Comptroller of the Currency warned that Tikal was inaccurately trying to present himself as a private banker.


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