Thursday, October 27, 2011

Here we go again with that attorney client privilege shit again!

We've discussed this concept ad nauseum since the inception of our blog.  It's a pretty simple concept, from Wikipedia...
...a legal concept that protects certain communications between a client and his or her attorney and keeps those communications confidential. The attorney-client privilege is one of the oldest recognized privileges for confidential communications.[1] The United States Supreme Court has stated that by assuring confidentiality the privilege encourages clients to make “full and frank” disclosures to their attorneys, who are then better able to provide candid advice and effective representation.
Simple enough right?  Go into your attorney's, bare your soul and tell your attorney the truth about whatever you're involved in so that that can effectively represent you and possibly get you out of the pickle you've found yourself in.  When you run afoul of the law, you'll tell your attorney things that you wouldn't want the cops or the prosecutors to know about, if you're smart, you'll tell your attorney the truth about what's gone on and hope that they can figure out a proper defense to make sure you stay out of trouble.  

Several months ago we played you a tape of Ponzi schemer Scott Rothstein trying to reach out to his client, former Plantation cop Joe Guaracino who was under federal investigation for mortgage fraud at the behest of the feds who were trying to get Guaracino to talk to Rothstein about his pending legal troubles while the feds listened in.

We outlined a "hypothetical" scenario a little over a year ago, take the time and read over that post again.   Problem with that "hypothetical" scenario is that it wasn't hypothetical, it actually happened.  The prosecutor that was running the Bernardo Barrera mortgage fraud case, the first case we discussed on our blog, actually forced one of the targets of his investigation to wear a "body wire" while they were at their attorneys office with other targets in the case discussing the case with their attorney!  From what we had heard at the time, assistant state attorney Bill Kostrzewski had threatened to arrest the individual unless they wore the wire and worse, both Kostrzewski and that assclown mortgage fraud detective Jorge Baluja both threatened this person with arrest if they ever told anyone about wearing the wire!  NICE!  Of course they wouldn't want anyone to know that they were able to listen in on privileged attorney client conversations, the cop could always say that he did it at the direction of the prosecutor, but what excuse would the prosecutor have?

At first I really had no proof other than a rumor I heard that started with a distant relative of the person wearing the wire.  Regardless, for the last three years I kept at it until I finally managed to meet the person who wore the wire who then confirmed the whole story and also confirmed that the wire at the attorneys office was approved by non other than assistant state attorney Bill Kostrzewski himself.

For those of you who don't understand the magnitude of the state listening in on privileged attorney/client conversations regarding a pending criminal matter, talk to an attorney and see what they tell you.  As for our friend Mr. Kostrzewski, get ready, the ride ahead is going to get a bit bumpy, I suspect you'll be hearing from the Florida Bar pretty soon...

Tuesday, October 25, 2011

Lender negligence, admissible or not?

We've stated time and time again that the banks that lent the money throughout the real estate boom of the last decade were just as responsible for the real estate and subsequent economic meltdown as were the people they lent the money to, we've even gone so far as to label them the "unindicted co-conspirators" in many of the criminal mortgage fraud cases that we've discussed.

Some of you may remember the prosecution in the Plantation cops mortgage fraud case fighting tooth and nail to stop the defense attorneys from using the theory of "lender negligence" as part of their defense.   From one of the prosecutions motions...
...precluding the defendants from presenting evidence of, or argument referring to, 
  1. any lack of actual reliance by the victim mortgage lenders on the defendants’ misrepresentations
  2. any purported or actual negligence by victim mortgage lenders; or 
  3. the present foreclosure crisis and the Government’s action in seeking to resolve the foreclosure crisis, whether in opening statement, direct or cross-examination, closing argument or otherwise. 
I'm not sure what the f-ing big deal was about keeping the theory of "lender negligence" from the jury, what ever the case may be, the judge agreed with the prosecution and for reasons unbeknownst to me, the jury never heard a peep about lender negligence.  I had my theories about what went on and even went so far as to suggest that the judge may have been biased towards the prosecution.  Who knows what really went on here, what you would expect though is if that one federal judge rules a certain way regarding using the theory of lender negligence as a defense, wouldn't you think another federal judge would rule the same way in a similar trial?  I was researching the Ivanhoe Semester mortgage fraud case the other day and I came across another motion by the government to exclude lender negligence as a defense, here it is...

Motion in Limine to Exclude Lender Negligence Ivanhoe Smester

As the title of the motion says...
That's funny as shit, not only does the prosecution not want the jury to know about any lender negligence during the real estate meltdown, but they don't want to have the jury hear about anything the government might have done to help blow up the bubble either!  SWEET!  It's almost like they're asking the jury to ignore that closeted gay cross dressing family member during holiday gatherings, we all know that he/she is there but god forbid anyone mentions anything!

So what's the big deal here?  While Judge Cohn from the Plantation cops mortgage fraud case granted the governments motions and didn't allow the jury to hear anything about lender negligence and the role the banks played in the real estate and economic meltdown, the judge in the Ivanhoe Semester case, Judge Cecilia Alatonga, wasn't having any part of that bullshit, several months before the Plantation cops case went to trial, Judge Alatonga denied the government's motions and allowed the defense to use the theory of lender negligence as part of their defense.  At least in my opinion, that was the right thing to do, now, can someone explain why Judge Cohn didn't rule the same way? 

Friday, October 21, 2011

The Ivanhoe Smester mortgage fraud case, just a little more complicated than the New Times thought And finally, someone files a complaint against City of Miami Commissioner Marc Sarnoff!


Earlier this week we discussed the New Times article on the Ivanhoe Smester mortgage fraud case, the article alleged that Mr. Smester was wrongfully imprisoned for some frauds that his childhood friend committed, the article then goes on to say...
Finally, three days before Valentine's Day 2011, a judge dismissed the counts against Smester.
Some how the article left out the fact that Mr. Smester went to court on these charges and after a short trial was found guilty!  Check out the indictments...

Indictment Ivanhoe Smester

Superseding Indictment Ivanhoe Smester

And the subsequent verdict...

Jury Verdict Ivanhoe Smester

So things are a little more complicated that they appear in the New Times article, we'll get together what we can of the case file today and discuss on Monday.

Our friends over at the Crespo Gram report and Investigation Miami have done a great job covering the how Commissioner Marc Sarnoff allegedly used the taxpayer funded Downtown Development Authority to help him win his bid for reelection, now it looks like one of the candidates running against him, Michelle Niemeyer has followed their lead and filed a complaint against him with the Miami-Dade Commission on Ethics & Public Trust and notifed the State Attorneys office of the situation.  From the Daily Business Review article...

A candidate seeking to oust Miami Commissioner Marc Sarnoff claims he used his position with the Downtown Development Authority to benefit his political campaign.
Michelle Niemeyer, an attorney and chair of the Coconut Grove Village Council, filed a complaint Thursday with the Miami-Dade Commission on Ethics & Public Trust.
She alleges Sarnoff misused public resources, including DDA employees, when he allowed the authority to mail postage-paid postcards to downtown residents and likely voters.
According to the complaint, Sarnoff didn't object to the DDA board's decision to pay for the cards that asked for contact information in case residents wanted absentee ballots or wanted to make address changes.
The postcards were pre-addressed to the DDA office, not the Miami-Dade Elections Department. Niemeyer said Sarnoff would have useful voter information at his disposal when the DDA collects the postcards.
"DDA funds and DDA employees' time and resources had to have been used in creating the materials and dealing with the responses," Niemeyer claimed.
Sarnoff said the complaint is baseless. He said the DDA has neither shared the voters' information with him nor has he asked for it.
Sarnoff said the DDA had a similar mailing campaign during the recent county mayoral elections.
The DDA is funded through property taxes levied on businesses and condo owners in the downtown and Brickell areas.
Niemeyer sent a copy of the complaint to Miami-Dade State Attorney Katherine Fernandez Rundle.
A great step in the right direction, I doubt the complaint is going to get anywhere but at least it will bring to light the kind of shenanigans going on behind the scenes during this campaign.

Wednesday, October 19, 2011

Sentencing for two guys who admitted to a decade worth of fraudulent mortgages...


So what do you get when you've admitted to committing hundreds of millions (if not billions) of dollars worth of mortgage fraud over the span of a decade?  The two mortgage brokers at the epicenter of the Plantation Cops mortgage fraud trial, Matt Gulla and Rene Rodriguez Jr, have finally received their sentences, remember, they both admitted to among other things, destroying evidence, committing thousands of other frauds, not to mention that they literally imploded in court while testifying against the men on trial possibly causing the prosecution their case.  

So what would these guys get considering the only two guys convicted in this entire case John Velez and Joseph Derosa received 42 months and 37 months respectively in federal prison for committing a fraction of the crimes that Gulla and Rodriguez committed.  Take a look for yourselves...

Matt Gulla Sentence

Rene Rodriguez Jr. Sentence

Interesting huh?  Matt Gulla gets 34 months and Rene Rodriguez gets 43 months in federal prison.  Remember even after these guys both became cooperating government witnesses they were proven in court to lie about the extent of the other frauds they were involved in, were exposed to be liars while on the stand severely damaging the prosecution who they were supposed to be helping and then admitted to committing fraud in every single loan they processed over the last decade, by their own admission, fraud in over a billion dollars worth of mortgages.  With all that in mind does it seem fair that they literally only get a slap on the wrist for their crimes?  

Let's not forget that in addition to everything else that they did, after cooperating with the government and allegedly turning over all the evidence that they had in their possession pertaining to the case at hand almost two years after they had cut their respective deals and cooperated with the government, on the eve of the first trial they admitted to shredding documents and destroying their office servers which could have held tons of documents that would have been favorable to the defense.  Even after making that kind of admission, at the end of the second trial the government even made a motion to the court asking that their sentences be reduced because of their "substantial assistance" to the prosecution.  WTF?!

Remember, before there were any indictments, before there was even a hint of anyone getting arrested in the Plantation Cops mess, both Gulla and Rodriguez had retained top flight defense attorneys and had hammered out deals with the government in exchange for selling out the rest of the guys charged.  Considering how light their sentences are and the fact that they won't pay any restitution despite admitting to over a billion dollars worth of fraud, this just goes to show that when you think the shit is going to hit the fan, make sure you win the race to the prosecutors office, whoever gets there first, will get the best deal as evidenced by Gulla and Rodriguez's sentences.  That's all well and good if you can live with yourself and don't mind looking over your shoulder for the rest of your life...

Tuesday, October 18, 2011

In a hurry but in the mean time, check out this horrific botched mortgage fraud case...


Sorry folks, too much going on to dedicate the time needed for a proper post, in the mean time check out this horrific botched mortgage fraud case from yesterdays Miami New Times...
"Where is Julio Llanessa!" screamed the lawman's voice on the phone. Ivanhoe Smester was baffled. The Dominican immigrant hadn't spoken to his childhood friend in more than a year, even when Llanessa was arrested for mortgage fraud. So why were U.S. Marshals calling him now?
Unbeknownst to Smester, Llanessa and girlfriend Laura Fernandez had jumped a half-million dollars in bond, jetting out of the country on a private plane. It was March 2010. Prosecutors were furious. They were also convinced Smester knew where his buddy from Santo Domingo was hiding.
In a matter of days, Smester's life was turned upside down. Feds showed up at his mother-in-law's house looking for him. They called his father in the Dominican Republic. On April 26, Smester turned himself in. Prosecutors charged him with bank and wire fraud involving a dozen properties in South Florida. "I was shocked," Smester says. "I've never been involved in the mortgage business. I've never even bought a house here in the U.S."
At the Federal Detention Center in downtown Miami, prosecutors again leaned on Smester for his friends' whereabouts. They told him he was facing 30 years if he didn't cooperate. Even worse, because Smester hadn't yet become a citizen after marrying his American wife, prosecutors threatened to deport him. He might never again see his 1-year-old son. All because his name appeared -- misspelled Semester -- on a check supposedly cashed by Fernandez.
"The reason why Ivanhoe was indicted on such thin evidence was that they truly believed that he knew where Julio and Laura were," says Smester's lawyer, Silvia Piñera-Vasquez. "They were fishing. The government just threw out a net and caught him, but he didn't have anything to do with it."
Jail was a living hell. The government even secretly recorded visits from his wife. Even she was losing faith. Their marriage was falling apart.
"I spent those ten months in jail wondering one thing," Smester says. "Why did they use my name? Why involve me in the fraud they were committing?" He replayed in his mind the last time he had seen Llanessa, when the property flipper's $700,000 Lamborghini was repossessed in Brickell.
Finally, three days before Valentine's Day 2011, a judge dismissed the counts against Smester. He lost nearly a year of his life because of a bogus check. He holds out hope that his childhood friend will pay for setting him up. "I think they'll catch him," Smester says. "Julio has hurt a lot of people."
 Horrific to say the least, poor guy sits in jail for ten months because the government thinks he knows where his alleged accomplice is and he wouldn't give him up.  Does this sound rational to you guys or does this sound like something befitting Hitler's gestapo?  

Thursday, October 13, 2011

The nightmare is over for Steven Stoll and Dennis Guaracino...


Another twist in the Plantation Cops mortgage fraud case, just like that it's over for two of the remaining three defendants...

Government Dismisses Federal Mortgage Fraud Case Against Steven Stoll and Dennis Guaracino

From the Sun Sentinel...
Federal prosecutors said Wednesday they are dropping all criminal charges against a Fort Lauderdale lawyer and a former police officer arrested last year in a mortgage fraud investigation.

The decision to dismiss the cases against attorney Steven Stoll and former Plantation Police Officer Dennis Guaracino comes a month after a Fort Lauderdale federal jury deadlocked on the charges against them.

The two men and Joseph Guaracino, who is Dennise Guaracino's brother, spent more than five months on trial defending themselves against allegations resulting from "Operation Copout" — an inquiry into a group of police officers involved in suspicious real estate transactions.

The U.S. Attorney's Office will continue pursuing its case against Joseph Guaracino, whose first trial also ended in a hung jury, federal prosecutors told U.S. District Judge James I. Cohn.

That's great news for attorney Steven Stoll and Dennis Guaracino but not so great news for his brother Joe who looks like he's going back to court to face a second trial which is set to start on December 5, 2011.

Tuesday, October 11, 2011

More on former City of Miami assistant fire chief Veldora Arthur's lawsuit against J.P. Morgan Chase for fraud!


As we mentioned last week, just days after City of Miami assistant fire chief Veldora Arthur was convicted for various types of fraud in federal court, lawyers on her behalf (as well as several others) filed suit against J.P. Morgan Chase for of all things, FRAUD!  From the Daily Business Review article...

Boca lawyer goes on offensive against Chase

Adolfo Pesquera
Most lawyers who represent homeowners in foreclosures use defensive strategies in their efforts to hold off the lender, but not W. Jeffrey Barnes.

The Boca Raton lawyer has launched an offensive against JPMorgan Chase using state racketeering law.

Barnes filed a state civil RICO action in Palm Beach Circuit Court against Chase claiming the lender engaged in a national pattern of "fraudulent foreclosure proceedings based on false and fraudulent misrepresentations."

It may not be the preferred legal strategy in challenging Florida foreclosures, but that doesn't necessarily mean it's a bad idea, prominent foreclosure defense attorney Thomas Ice said.

"We've looked at all sorts of plaintiff-side actions, particularly the class-action type lawsuit," said Ice, managing partner of Ice Legal in Palm Beach Gardens. But ultimately we decided they aren't suited for our client base. We'll continue to use defensive strategies rather than offensive strategies."

Going down the beaten path has not been Barnes' method. The founder of the Newport Beach, California-based Foreclosure Defense Nationwide website and blog has built a national network of 39 law firms, allowing him to defend against foreclosures in 26 states. The latest lawsuit, Linda Zimmerman et al v. J.P. Morgan Chase and Chase Home Finance, represents his alliance with the Washington Mutual Homeowners Support Group, a grassroots organization of former WaMu mortgage customers.

The lawsuit is not intended to save anyone's home, Barnes explained. It is a counter-punch intended to hurt the bank by exposing its alleged fraud.

"This was never intended to be arm-twisting to get the bank to do loan modifications," he said. "These are damages claims."

Foreclosure Rights
The alliance had its genesis in how Chase claimed the right to foreclose on the defunct WaMu's home loans.

When WaMu failed in 2008, the Federal Deposit Insurance Corp. sold certain assets to Chase. But in filings submitted in Deutsche Bank v. FDIC and Chase, Chase said it "did not become WaMu's successor in interest," Barnes cited in the lawsuit.

Despite that admission, Barnes said Chase — through its servicer Chase Home Finance — instituted foreclosure proceedings nationally on WaMu mortgages, listing itself as successor in interest to carry forward WaMu's ownership interests.

The lawsuit claims Chase and Chase Home used the electronic clearinghouse Mortgage Electronic Registration Systems and bogus assignments to improperly pursue foreclosures. The bank also allegedly ignored state laws, such as required certifications in New Jersey and mandatory good faith pre-foreclosure resolution efforts in California.

"This pattern of filing false declarations ... and failure to provide proof of legal ownership in Florida and other jurisdictions is consistent with Chase's pattern of falsely misrepresenting the legal scope of the FDIC affidavit," Barnes said.

Chase has received a 30-day filing extension, delaying its answer to the Palm Beach Circuit lawsuit, Barnes said.
Chase representatives did not respond to calls for comment by deadline.

The lawsuit seeks an injunction to stop to all Chase foreclosure activity in eight states: California, Florida, Massachusetts, New Jersey, New York, Tennessee, Washington and Wisconsin. They are home to the 32 homeowners suing Chase individually, not as a class.

"We expect that there are going to be more," Barnes said.
One of the reasons the suit was filed in Florida is the operations of the servicer, Chase Home Finance, he said.
"I termed it nationalized mail fraud in the lawsuit because of the generation of documents out of (Chase Home's) nerve center in Jacksonville," he said.

Legal Options
Zimmerman, a Boca Raton legal researcher, claims she was suckered into a negatively amortized loan, something she didn't realize until after the closing in 2008. Her $1,800-a-month mortgage quickly turned into a $3,425-a-month payment, and she fell into default in February 2009. Her house today is worth a third of its original value.

Relying on her professional training, Zimmerman became a resource for the WaMu Support Group. She said the assignment document used against her listed a receptionist as a bank vice president.

"It's a person who was not an official of the bank," Zimmerman said. "Their fraud became very evident."

She and the Support Group approached Barnes about using the Florida Civil Remedies for Criminal Practices Act, the state RICO law, against Chase.

"I had considered different options, class action lawsuits," Zimmerman said. "The only ones that seemed to benefit from class actions were the lawyers."

She noted the example of an acquaintance in California who was in a class action against Bank of America. His portion of the settlement came to $3,009. She did not think that was a solution.

Document Fight
Lenders and servicers have been successful in avoiding having questionable documents used against them in Florida courts by dismissing foreclosure actions when homeowners allege fraud, Barnes said.

"In other Chase litigation, I have to fight to get documents. Routinely, they object to almost everything. They fight you on the discovery. That's probably why we've had so many cases dismissed for discovery violations. Once there's an order compelling discovery, the banks just don't respond or they ask for open-ended extensions or they file incomplete responses. The judge files a dismissal without prejudice with the refiling conditioned on providing discovery, and they just don't do it," he said.
A nationwide RICO action broadens the possibilities for discovery. Barnes pointed to a case in Las Vegas.

Troy Fox, an associate at Crosby & Associates in Las Vegas, handled a case accusing Wells Fargo of using a fraudulent notary stamp on a deed of trust assignment. This surfaced during the third loan modification mediation.

"They again denied the client for a modification. We asked about the stamp. They said, 'We don't think it's an issue.' We did," Fox said.

Fox is asking for an evidentiary hearing on the fraud claim and sanctions sufficient to bring the mortgage down to the current market value.

"Nevada is a nonjudicial state," Fox said. "They cannot rescind the notice of default unless we agree."

While Ice, who has been at the forefront of probes into the robo-signing scandal, has opted not to pursue RICO claims, he applauds attorneys who try different approaches. Any method that exposes more fraud can only help other attorneys, he said.

"It becomes much easier for you to get your own information because you already have a road map of where you want to go," Ice said.

While I agree that the practices engaged by the banks recently in these foreclosure proceedings are just as egregious as the frauds that the borrowers engaged in when they borrowed the money, at the end of the day what you can't get around is the fact that these people ARE NOT PAYING THEIR DAMN MORTGAGES!  Regardless, why aren't these banks punished in the same manner as the people who submitted fraudulent paperwork on their loans?  Why the double standard?  Over the course of our blog, we've seen several instances where people where convicted and sentenced to prison for simply misstating their incomes on loan applications or by submitting some fake paperwork in order to get approved for a home mortgage, so why the double standard?  Why aren't these banks held accountable just like the average citizen?

Regardless, here's the lawsuit for your reading pleasure.  The first eleven pages consist of legal maneuvering by Chase's attorneys to get the case removed from circuit court and into the proper federal venue, enjoy...

Veldora Arthur Sues Chase for Fraud

A bit of advice to the attorney who filed this suit, Mr. W. Jeffrey Barnes, perhaps next time you may want to vet your clients a little better and make sure that they weren't just federally convicted for FRAUD before you file suit on their behalf!

Friday, October 7, 2011

What happened in the Veldora Arthur federal mortgage fraud case in her own words. And guess who's suing J.P. Morgan Chase for FRAUD?!

We're fortunate enough to get a rare glimpse into what exactly happened in the City of Miami Assistant Fire Chief Veldora Arthur's federal mortgage fraud case, that is what happened according to Veldora herself as she explained it to the FBI.  Here's a transcript of what she told the FBI and the AUSA during her interview on August 5, 2010...

FBI Interview of Veldora Arthur

We'll go through it in detail on Monday, but till then, has anyone guessed who's suing J.P. Morgan Chase for fraud?  I'll give you a hint...

You got it, just days after she was thrown in Federal Prison for all sorts of fraud, lawyers on behalf of Veldora ACTUALLY SUED J.P. Morgan Chase for fraud on her behalf!

LOL!  We're digging up the complaint now, we'll discuss on Monday.  Have a nice weekend!

Wednesday, October 5, 2011

Meanwhile back at the Herald...

While we were rather impressed with ourselves for being mentioned the other day in the Miami Herald regarding our coverage of the Veldora Arthur mortgage fraud trial, we actually missed the Herald's first attempt at covering the verdict last week.  Take a look for yourselves at the story that was buried in the business section, as always click on the image to enlarge...

Funny how the City of Miami's Assistant Fire Chief gets convicted of several counts of mail and wire fraud yet somehow it doesn't make the headline, instead the story is led off with...
Broward man sentenced in fraud schemes.
Even worse, the Herald's staff writer Toluse Olorunnipa couldn't even figure out where Veldora worked, from the article...
...a former assistant to Miami-Dade’s fire chief was found guilty of taking part in an $11 million mortgage fraud scheme in Aventura...
Oh really?

I could have sworn Veldora was employed by the City of Miami and not Miami-Dade county!

Despite the Herald's failure to put together a proper story, their real failure was highlighted by our friends over at Random Pixels yesterday.  While the Herald has been largely ignoring Veldora's story and has relegated it to the back pages of the paper, the Herald's Spanish sister publication, El Nuevo Herald, deems Veldora's mortgage fraud capers to be front page news...

From the El Nuevo Herald article (with translation thanks to Random Pixels via google translate)...

by Melissa Sanchez
El Nuevo Herald

Veldora Arthur, the Deputy Chief of the Miami Fire Department, convicted Friday of mortgage fraud, will be eligible to continue receiving almost $167,000 in annual pension while jailed.

Robert Nagle, manager of the Retirement Fund for the Fire and Police of Miami, said a lawyer for the Fund is reviewing the federal case against Arthur to determine whether the crime in her capacity as deputy chief - for example, in uniform or during hours.

"Committing a felony could cause a recipient of a pension to lose [his/her] pension, but the crime must have been connected to his position," said Nagle. "If it was something they did in their private time, then they keep their pension."

Amazing how the Herald won't cover sensitive City of Miami related matters and how us non Spanish speaking readers have to look to the Spanish version of the Herald to find out WTF is going on!  Regardless, we're still looking into documents regarding Veldora's crimes in order to determine whether or not she used her official possession at the City (not the county) during the commission of the frauds she was indicted for, we'll update as soon as we find anything new.

Tuesday, October 4, 2011

What everyone wants to know, was Veldora Arthur committing mortgage fraud while on the job at the City of Miami Fire Department?


Now that City of Miami Assistant Fire Chief Veldora Arthur has been convicted of several counts of mail and wire fraud, the question that everyone seems to be asking is whether or not she's going to keep her City of Miami FD pension.  The litmus test seems to be whether or not she committed the crimes while on the job at the fire department, from our comments sections yesterday...
It's gonna have to be proven that she used her official position to commit the felony.
Understood, so how can we prove that she used her official position to commit the crimes she was indicted for?  Once again from our comments section...
There was a rumor that she used her City fax or email to transmit some of the fraudulent communications. Can you look into that?
Of course we can!  Without having the entire case file at my disposal, this was a bit of a challenge, that is until I found this bit of information regarding a dispute Veldora had during the purchase of another home unrelated to the indictment where her primary residence was called into question.  Take a look at this excerpt...
It bears mentioning that after the purchase of Unit 3711, Loan City, the lender, conducted a review of the documents submitted in support of the loan for Unit 3711 and came to the conclusion that the defendant had misrepresented, among other things, her occupancy of the property as her primary residence. Loan City sought indemnification from WCS Lending who processed and collected the information on behalf of Loan City. In connection with that dispute, the defendant on June 27, 2006 wrote a letter that was faxed that same day from the City of Miami Fire Department wherein she stated as follows: “In regards to the statement regarding my residency, I have never stated to any official at Loan City or any other agency that I don’t reside at 3370 Hidden Bay Drive, Unit 3711. That statement is totally false as I have been residing there since I purchased the unit.”
In this instance, Veldora was purchasing a home on the west coast and inadvertently listed her primary residence as her home in Weston, when the mortgage broker who was reviewing the loan package for the home on the west coast that they had just lent her the money on, they spotted the Hidden Bay drive unit on her credit report (which was one of the homes that were part of the federal indictment) and realized that she had submitted conflicting statements about where her primary residence was.  In an effort to cover her tracks, Veldora wrote a letter to the lender where she stated...
“In regards to the statement regarding my residency, I have never stated to any official at Loan City or any other agency that I don’t reside at 3370 Hidden Bay Drive, Unit 3711. That statement is totally false as I have been residing there since I purchased the unit.”
Unfortunately Veldora sent this bogus letter while on the job at the City of Miami Fire Department...
"the defendant on June 27, 2006 wrote a letter that was faxed that same day from the City of Miami Fire Department"
While this is the only evidence we've been able to find of Veldora using her position at the FD to commit the frauds she was ultimately convicted of, we're told that there were several other instances where she used her time on the job to further her criminal activities.  The question that remains is whether or not this is enough to get her pension taken away from her.  We'll keep looking for a definitive answer and report back.

Monday, October 3, 2011

We get a mention in the Miami Herald and celebrate an anniversary of sorts...

As the title says, we've finally gotten some credit for our work in the Miami Herald story regarding convicted mortgage fraudster Veldora Arthur.  Unlike the Herald's Chuck Rabin, who flagrantly ripped off our story and neglected to credit us,  Herald staff writer  Elinor J. Brecher did a fantastic job summing up the conclusion of the nearly two week long mortgage fraud trial.

The question that remains to be asked now that Veldora's behind bars is what's the story with her city of Miami FD pension?  I'm being told by several sources that because of her conviction, her pension could be gone?  I'm doing a little more digging on this matter and will update as soon as possible.

Now, on to this anniversary business, today marks the three year anniversary of the mortgage fraud case that lit the fire under my ass to start this blog, specifically the Bernardo Barrera mortgage fraud case.  For those of you unfamiliar with the story, it's a case that was hobbled together in a rush by a rookie MDPD detective, Jorge Baluja, and a washed up assistant state attorney, Bill Kostrzewski, where they took the word of a unemployed serial fraudster named Bernardo Barrera, who claimed that his identity was stolen and used in the commission of a massive mortgage fraud scheme.  Unfortunately, the state put together the case without properly investigating and overlooked the fact that alleged "victim" was himself an integral part of the mortgage fraud scheme.  Once we uncovered Mr. Barrera's complicity in this scheme, he quickly uprooted and hauled ass to Panama.  What's troublesome though is even though we presented overwhelming evidence of Mr Barrera's complicity to the state attorneys office, to this day they refuse to go after him.  

So where are the other players responsible for this mess today?  Assistant state attorney Kostrzewski's been thrown off the mortgage fraud unit at the state attorneys office and Detective Baluja has been thrown down to the "Homestead exemption fraud" unit in the MDPD where he's charged with going after people who cheat on their homestead tax exemptions.  So much for climbing up the ladder, right guys?  Oh well!

We're awaiting the arrival of more documents on the Veldora Arthur case, tomorrow we should have a copy of Veldora's pre indictment statement to the FBI of just how things went down in her very own words.

Saturday, October 1, 2011

Update on the Veldora Arthur mortgage fraud case.

Looks like the United States Attorney's Office issued a press release regarding the outcome of the Veldora Arthur, Neil Fagan and Pamela Johnson mortgage fraud trial late Friday afternoon.  Here it is in it's entirety...


September 30, 2011
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announced that a federal jury found defendants Neil Fagan, Pamela Johnson, and Veldora Arthur guilty of conspiracy to commit wire and mail fraud, and all substantive mail-fraud counts set forth in the February 3, 2011 superseding indictment. The indictment included charges of conspiracy to commit wire and mail fraud and substantive mail fraud. The conspiracy and mail fraud counts carry a statutory maximum sentence of 20 years’ imprisonment. All defendants were remanded into the custody of the United States Bureau of Prisons following their convictions.
Fagan and Johnson were charged in Counts 1 through 5 of the indictment and were convicted on all counts. According to the evidence, Fagan recruited the straw buyers who bought the properties listed in the indictment and received approximately $1,300,000 in mortgage fraud proceeds. Johnson served as the settlement agent who handled the real estate closings and diverted fraud proceeds to herself and family members. Arthur, charged and convicted of Counts 1, 3, and 5, was an Executive Assistant to the Fire Chief in the City of Miami Fire Department who served as a straw buyer. Arthur received approximately $317,000 in fraud proceeds in less than a month.
The properties in the case were located at 3370 NE 190 Street in Aventura, Florida, which is known as the Hidden Bay Condominium Complex. During the course of the conspiracy approximately $11,000,000 in fraudulent loans were issued, resulting in a loss to lenders of approximately $7,000,000.
Sentencing for Johnson and Fagan has been scheduled for December 15, 2011at 8:30am. Sentencing for Arthur has been scheduled for December 16, 2011 at 8:30 am.
Mr. Ferrer commended the investigative efforts of the FBI. The case was prosecuted by Assistant U.S. Attorneys Armando Rosquete and Sean McLaughlin.
I missed a crucial part of the press release after a quick glance, earlier today our friend Bill Cooke from Random Pixels highlighted what we missed... 
All defendants were remanded into the custody of the United States Bureau of Prisons following their convictions.

HOLY SHIT!  How the hell did I miss that?  Veldora and company were thrown in jail right after the verdict came down?  Lo and behold, Veldora and her codefendants are actually sitting in the federal detention center in downtown Miami!  For the foreseeable future Ms. Arthur is going to be known as federal inmate #96343-004 and will be calling a cell much like this one in the Miami FDC home...

This really caught me off guard since most defendants that I've known of are allowed to stay out on bail while they're awaiting sentencing, I'm amazed that they took her into custody right after the verdict.  Regardless of what Veldora may have done, I can't begin to imagine how hard this must be for herself and her family, first the indictment and now the incredible fall from being the City of Miami's first black female firefighter and assistant fire chief to now simply being a convicted felon sitting in jail possibly for the next twenty years.