FEDERAL

Short Sale Schemes
A short sale occurs when a lender allows a borrower
who is “underwater” on his/her loan—that is,
the borrower owes more than the property is
worth—to sell his/her property for less than the debt
owed. Short sale fraud usually involves a borrower
intentionally misrepresenting or not disclosing
material facts to induce a lender to agree to a short
sale to which they would not otherwise agree.
Las Vegas Realtors Use Straw Buyer to Commit
Short Sale Fraud, Las Vegas, Nevada
On June 12, 2013, Robert and Cynthia Hosbrook
were indicted in the U.S. District Court for the
District of Nevada for bank fraud and conspiracy.
On June 7, 2010, a short sale was approved for
the Hosbrook’s personal residence allegedly based
on fraudulent representations that the short sale
was due to personal hardships, the transaction was
arms-length (i.e., the sellers and buyers were not
family members), and the seller would not remain in
the property subsequent to the sale. In contrast, the
Hosbrooks, real estate professionals, allegedly made
a cash sale of their personal residence to a relative
acting as a straw buyer and remained in their home
after the sale. Freddie Mac suffered a loss of $174,000
as a consequence of the short sale.
This was a joint investigation with the Nevada
Attorney General’s Office.
Homeowner Commits Short Sale Fraud,
Sacramento, California
On May 14, 2013, Agustin Simon pled guilty to
conspiracy to commit bank fraud in the U.S. District
Court for the Eastern District of California.
From March through October 2010, Simon
conspired with others, including a real estate broker
and a straw buyer, to defraud his financial institution
and Freddie Mac by making false statements about
the short sale of his home. Simon knowingly failed
to disclose an agreement that would ultimately allow
him to regain ownership of his home following
the short sale. The transaction caused a loss of
$107,000 to Freddie Mac and a loss of $247,000
to Tri Counties Bank, a federally insured financial
institution.
This was a joint investigation with the FBI, IRS-CI,
and Stanislaus County District Attorney’s Office.
Loan Modification and Property
Disposition Schemes
Many companies claim to be able to secure loan
modifications for desperate homeowners. Some even
claim affiliation with the government. Unfortunately,
the offers usually come with upfront fees and
little action, leaving homeowners even worse off.
Additionally, various fraud schemes can impact sales
of enterprise REO.
Former Loan Officer Defrauds Real Estate
Investors, Saint Louis, Missouri
On September 26, 2013, in the U.S. District Court
for the Eastern District of Missouri, Daniela Spiridon
pled guilty to wire fraud.
Spiridon, operating under various business names
including Proficio Mortgage, defrauded individuals
by misrepresenting that she had contracts with
Fannie Mae and banking institutions allowing
her to sell packages of REO properties, as well as
individual foreclosed properties, on their behalf.
Spiridon required individuals to wire earnest
money for foreclosed properties and told them that
if they put more money down it was more likely
that Fannie Mae would select them as the buyer.
Spiridon obtained large down payments (hundreds
of thousands of dollars) from investors/victims who
thought they were paying for packages of bundled
Semiannual Report to the Congress • April 1, 2013–September 30, 2013 29