2012 starts off well for Veldora Arthur and once again, the tax payers get screwed!

As most of you already know, convicted fraudster and ex City of Miami assistant fire chief Veldora Arthur got to keep her pension.  We sat through an hour long hearing last week at the City of Miami Fire Fighter and Police Officer Retirement Trust, let's just say that the hearing was a farce.  Our sources tell us that there was a bunch of back room dealing that went on before the hearing virtually guaranteeing that Veldora got to keep her pension despite the crimes that she committed while on the job, we'll cover that in detail later this week, in the mean time, check out our friend Melissa Sanchez's coverage of the hearing at the from the Miami Herald here.


While I expected Ms. Arthur to get to keep her pension, what I didn't expect was this...

Veldora Arthur Restitution Order

That's right, in case you missed it, here's the part that left me FLOORED!

What was that?

HUH?

That's the icing on the cake, isn't it?  It's bad enough that Ms. Arthur got to collect her full pay and benefits while sitting at home awaiting trial, now she's sitting in prison STILL COLLECTING HER $167,000 PENSION and as a parting gift, the federal government has decided that despite the fact she cost the banks millions of dollars worth of losses as a result of her nefarious schemes, she now doesn't have to repay them a single red cent!


So there you have it, the tax payer takes it up the ass not once, but TWICE!  We'll done!

Responding to some of the blog comments regarding former City of Miami assistant fire chief Veldora Arthur's sentencing...

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I'm working on a very important story regarding some unethical activity between City of Miami commissioner Marc Sarnoff and the City of Miami city attorneys office.  We'll have the story ready to go for tomorrow, in the mean time, let's look at some of the comments left over the last few days on our blog posts regarding  former City of Miami assistant fire chief and convicted fraudster Veldora Arthur.


Let's start with this comment...

Anonymous said...

Is she going to lose her city pension??? I really hope you follow this up. She need to lose this as well...

I believe she will lose all or part of her pension simply because she conducted most of these schemes while on City time while using city fax machines and in some instances even city letter head.

Anonymous said...

If the city has an ounce of morality left in its corrupt conscience, it will stip her of everything. I did not see a restitution amount for ripping off 11 milion. If she continues with her pension, this will be merely a slap on the wrist. Corruption and greed at its worst!!!!

There will be restitution, there's going to be a separete hearing in February just for that purpose.  

Anonymous said...

This was a scheme that involved many condo buildings, not just the one in Wellington. She may not have been involved in more than one of them, but the other people indicted along with her, or in similar connected schemes, were involved in more than the Wellington frauds. The series of defaults, after the straw buyers got their money, caused other condo owners to have to pay increased condo fees and property values to go down significantly. So, yes, disgorgement of all money she collected is appropriate.

Correct.  According to the prosecutor, the frauds in this case were just a minor smattering of the many frauds that Ms. Arthur was involved in, we're going to look at least one other fraud that she was involved with but wasn't charged for soon, perhaps after the holidays so that we can highlight how indiscriminate the government is when it comes to charging people based on their ability to garner headlines.  As to the second part of the comment, the judge mentioned the same, even going so far as to say that people like Ms. Arthur were the root cause of the real estate meltdown and because of their bogus inflated property values and subsequent busting out of the properties that we are where we are today with most homes underwater.

Anonymous said...

This convicted felon should lose her pension. She committed crimes WHILE ON DUTY. Send a message. Crime does not pay. What about the $120,000 she got while suspended?

That comments speaks for itself and I couldn't agree more.

Anonymous said...

If she lose her pension or not it won't benefit you! My sister & our family are moving forward & you all should do the same. My sister is paying her time to society & I don't think there is nothing else to talk about.

I'm sorry for the position you and your family find yourself in today as a result of the crimes that your sister was convicted of.  I take no joy in seeing the family suffer because of a series of poor decisions that Ms. Arthur made, but at the end of the day she is where she is and nothing can change that.  I take issue with your statement though when you say...

If she lose (sic) her pension or not it won't benefit you!

In fact, you are wrong when you say that by losing her pension "it won't benefit you".  See, a significant portion of her pension is paid by the taxpayers, the same taxpayers that paid Ms. Arthur an exorbitant six figure plus salary when she was on city time and simultaneously conducting these fraudulent transactions that had nothing to do with her job at the fire department.  For the taxpayer to have to continue paying her pension after she committed these crimes is a further insult to the citizens of the City of Miami.  I'll make you a deal, how about we go and randomly pick out a handful of citizens of the City of Miami and let's ask them what they think.  Are you up for that?

Anonymous said...

Chief Warshaw, the ex-police chief lost his from the City of Miami so she should lose hers too. Any bets she won't lose it...

Agreed.

Anonymous said...

The Straw Buyer, You keep pushing it she will lose her penison...Thank You so much....

That's a bit ridiculous isn't it?  I'm the least of her worries!  If you were in the courtroom during the sentence, did you take a look around and see who else was there?  There were a few members of the upper management of the City of Miami FD that had no love lost for Ms. Arthur who were all to vocal about how the rank and file felt about her tenure at the FD and how they felt about her pension.  Once again, let's not forget the citizens of the city who are appalled at the amount of money she was making on the job while they're working their asses off to make a fraction of what she was making at the FD.  While Ms. Arthur may have taken for granted the incredible pay and gold plated benefits she was getting at the taxpayers expense, most of us would kill to have the same kind of compensation so it's that much more appalling to see someone who had the world at her feet to get involved in this kind of mess.  Don't blame me if she loses her pension, she's got no one to blame but herself for that.


Now, till tomorrow, go back and read this blog post regarding our esteemed City of Miami Commissioner Marc Sarnoff and local gadfly and Coconut Grove resident Reid Welch.  This is going to get interesting.

BREAKING NEWS! Veldora Arthur gets sentenced

As the title states, former City of Miami assistant fire chief and convicted fraudster Veldora Arthur was sentenced to 57 months in federal prison this morning after a five hour hearing before Judge Patricia Seitz (check out her bio, WOW!) that started at 8:30 this morning. In addition to the 57 months, once released she'll have to serve an additional 36 months of probation.


I was in utter disbelief as I sat through this hearing, even after being found guilty and having been incarcerated for several months, Ms. Arthur both through her own statements and through her attorney, Bruce Lehr, who gave a somewhat less than stellar performance, were still making excuses and were both pleading ignorance regarding her role in the fraud.  At one point U.S. Attorney, Armando Rosquete brought up another instance of mortgage fraud that she had committed in a separate straw buyer scheme that she was involved with but not criminally charged for.  In this instance Ms. Arthur orchestrated the scheme and put up the money (approximately seventy four thousand dollars) for the down payment, a couple of days after the closing (we'll discuss this case next week in detail) Ms. Arthur received the money back with an additional ten thousand dollar profit.  To his credit, the prosecutor eloquently described the transaction and provided the court with all the relevant documents regarding the down payment that she put up for the straw buyer, wire transfer authorizations, bank statements, etc all detailing the approximately $74,000 being wired out of her account and then the subsequent $84,000 being wired back into her account days later (the original $74k + $10k profit).  When the judge asked Ms. Arthur's attorney to explain this suspicious banking transaction, he explained that his client knew nothing about the real estate transaction nor the wire transfers both in and out of her account.  As ridiculous as that may sound, the judge actually went so far as to say that if Ms. Arthur didn't authorize the wire leaving her account and since she had no idea who had authorized the wire that it must have been a phantom or a ghost that did so!

Are you fucking kidding me?  $74,000 leaves your account without your knowledge or your consent then a few days later $84,000 comes back in and you don't even think to question it?  WTF?

Judge Patricia Seitz

The worst part of this hearing was bringing her family and friends into the courtroom and having them dragged through this mess.  Somehow Ms. Arthur and/or her attorney thought it was a good idea to have her emotionally fragile 15 year old daughter before the court to make a statement.  I can't begin to tell you how horrible I felt watching this poor girl stand before the court and have to be subjected to seeing her mother wearing khaki prison clothes and with shackles around her legs.  This was truly and utterly unnecessary.

I have to really question what Ms. Arthur and her attorneys were thinking when they decided to take this case to trial rather than take a plea, the government had a mountain of incontrovertible evidence against her, most in the form of damning mortgage documents that she couldn't deny.  I suspect if she would have plead out that she could have ended up with something in the neighborhood of 24 months rather than the 57 months she ended getting.  

Regardless of what Ms. Arthur did to get herself into this position she finds herself in today, I have to tell you, seeing her family suffer through this hearing made for one of the saddest days of my life.  I pray that Ms. Arthur and her family get through this horrible ordeal and get on with their lives.

We'll discuss this hearing and its outcome at length next week.   

Veldora Arthur's attorney tries to tell the court why she shouldn't be put away for 57 to 71 months...

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Veldora Arthur

Our favorite former City of Miami Assistant Fire Chief and convicted fraudster Veldora Arthur is about to be sentenced in federal court for her role in a multimillion dollar mortgage fraud scam.  As we discussed a few months back, after Ms. Arthur was found guilty for her role in this nefarious scheme, she quickly dropped her former attorney, Larry Handfield, and retained prominent criminal defense attorney Bruce Lehr to handle the sentencing phase of her case.  Now her new attorneys come before the judge and give a litany of reasons why the court shouldn't slam her with a 57 to 71 month sentence as dictated by the federal sentencing guidelines.  Let's take a look at the many reasons her attorneys offer for Veldora to get a more lenient sentence.


Reason #1, she's really not that guilty...

On September 30, 2011, defendant ARTHUR was found guilty of three (3) counts out of a five count Superseding Indictment. Specifically, ARTHUR was found guilty of one (1) count of conspiracy to commit mail and wire fraud, and two counts of mail fraud in violation of 18 U.S.C. §§1349 and 1341, respectively.

Ok, I guess things could have been worse?  After all, she was found guilty of three counts rather than five, so she's not as guilty as she could have been?


Reason #2, she's really not that bad of a person and after all...

...it is respectfully submitted that ARTHUR’s history and characteristics (which include
25 years of service as a firefighter), family circumstances, and need to avoid unwarranted sentencing disparity, warrant a downward departure and/or variance from the sentencing guidelines. Prior to her arrest in connection with this case, ARTHUR, who is an extremely religious woman, had never been accused, arrested, or convicted of any crime.

I wonder how all that factored in when she was getting kicked back hundreds of thousands of dollars when she was closing on these fraudulent mortgages?


Reason #3, she's a hard worker...

After graduating from High School in 1982, ARTHUR enrolled at Miami Dade Community College where she took paramedic and EMT courses in the hopes of becoming a firefighter. In 1986, she was hired as the first female firefighter for the City of Miami Fire Department. For more than 25 years, ARTHUR was employed by the Fire Department and held numerous positions including Executive Assistant to the Fire Director and, ultimately, Assistant Fire Chief.

Yet somehow after all that hard work and rising to the command staff of the City of Miami Fire department and making close to $300k+ per year, it still wasn't enough.


Reason #4, she did real good in school...

ARTHUR simultaneously attended Barry University where she graduated Summa Cum Laude with a degree in public administration in 2001.

Fantastic.

After obtaining an excellent education and providing 25 years of honorable service and dedication to the City of Miami Fire Department, ARTHUR was relieved of her duties as a result of her arrest in this cause.

I beg to differ, she wasn't relieved of her duties, she was simply sent home for nearly a year while on the tax payers dime.  Let me know where I can sign up for the same deal.  On another note, if she was so dedicated to the fire department, why was she working as a mortgage broker, real estate fraudster, credit repairer, etc?  That hardly seems like someone who's dedicated to the Fire Department.  Perhaps some of her coworkers down at the Fire department would like to chime in and tell us just how dedicated she really was...


Reason #5, she's worried her son may not be able to get a job...

Additionally, it is significant to note that Arthur’s son expects to graduate as a paramedic in December of next year. Because of the publicity surrounding his mother’s case, he feels it may difficult to find employment in South Florida.

And why exactly should that concern the court?  Perhaps Ms. Arthur should have taken all that into consideration before she decided to engage in fraudulent activities?


Reason #6, she's not feeling so good...

As noted in the PSI, Defendant ARTHUR is a 46 year old woman with an extensive history of medical conditions, including Sjogren’s Syndrome, sleep apnea, high blood pressure, two herniated discs in her lower back1, hypertensive heart disease, and mitral valve disease.

Ok, and?  Is being healthy a prerequisite for serving the appropriate prison term?  She seemed pretty healthy when I saw her running around in Larry Handfield's office.  Again, I have to wonder, was she brought into the fraudulent closings in a wheel chair?


Reason #7, she went to the feds first...

It is respectfully submitted that ARTHUR’s voluntary disclosure to authorities was an act consistent with someone who was not aware that her actions were illegal. It was not a subsequent remedial measure taken by a defendant who is facing imminent prosecution. At the time ARTHUR disclosed her actions and the actions of others to her attorney and to the Government, there was no pending investigation against her. ARTHUR’s candor, which ultimately subjected her not only to criminal liability but to the loss of her freedom, warrants a downward departure from the sentence suggested by the advisory guidelines.

No kidding?  To me this sounds like someone that's simply won the race to the prosecutors office, not an "act consistent with someone who was not aware that her actions were illegal" but instead the actions of someone who knew they broke the law and was trying to save their own ass.


In summary...

Defendant VELDORA ARTHUR respectfully requests that this Honorable Court sentence her below the advisory guideline range based on her history and characteristics, 25 years of service as a firefighter, family circumstances, and unwarranted sentencing disparity. Additionally, Defendant ARTHUR respectfully requests that a downward departure be granted based on her medical condition and voluntary disclosure of the offense to government authorities.

Come on now.  I guess her attorneys have to give it a try considering the pile of money they must have gotten from Veldora.  I can understand all these wonderful reasons why the court should throw the book at her, but what I can't understand is if all of these things were true, why the hell did Ms. Arthur put herself in this position to begin with?  I'll be honest with you, if I was in her shoes, I would have been perfectly content making over $300k+ per year working over at the FD.  Easy administrative work, take home car, the best medical coverage money could buy as well as a fantastic pension package.  Ms. Arthur finds herself where she is today, behind bars, for one reason, GREED.  

Through this amusing narrative and these wonderful excuses her attorneys have provided the court, she's hoping to get her sentence reduced to something in the 24 to 30 month range.  I personally hope the court throws the book at her and gives her the maximum sentence of 71 months, if nothing else to send a message to anyone in her former position or anyone else in a cushy government job thinking about doing something as ignorant as she did and in turn throwing away an unreal job that took her 25 years+ to get.

Guess who's going to help decide who becomes the next City of Miami Police Chief?

I just about fell out of my seat when I heard who's going to help pick the next City of Miami Police Chief, from the Herald article...

Ten candidates have made the list of finalists to become Miami’s next police chief, following the spectacular firing two months ago of disgraced former Chief Miguel Exposito.
Among the contenders: a retired high-level state police special agent, several prominent former Miami police command staffers and the man who replaced Exposito in an interim role.
A selection committee headed by Miami-Dade Police Director Jim Loftus will begin interviewing finalists Wednesday, and will continue next week.

So far so good, I have the utmost respect for the Miami Dade County Police Director, James Loftus, he's alright by me.

The finalists are: Adam L. Burden, Thomas W. Cannon, Frank G. Fernandez, Michael J. Gugliotti, Rafael P. Hernandez Jr., Roberto Hylton, Manuel Orosa, Amos Rojas Jr., Gerald Speziale Jr., and Louis A. Vega.
Earlier this month, the selection committee picked the finalists from 71 applicants. Nearly 50 had already submitted their applications before Exposito was fired; his contract had been set to expire at the end of the year.
A sharply divided city commission voted to fire Exposito on Sept. 12. City Manager Johnny Martinez had suspended the ex-chief six days earlier for insubordination, saying Exposito overstepped his authority by moving forward with administrative demotions the manager had explicitly placed on hold.

We all remember that circus don't we?

The list of finalists features several candidates that are well known in South Florida law enforcement circles.
Orosa, considered a candidate before Exposito was named chief, has headed the department in an interim position. Burden and Cannon, former Miami assistant police chiefs, retired after Exposito demoted them and a slew of others in December 2009.
Fernandez is the former deputy chief under Chief John Timoney. Vega, a former assistant chief under Timoney, also served as the police director in Camden, N.J.
Rojas recently retired as FDLE’s regional special agent in charge after eight years in the post. Hernandez, a former Miami-Dade police officer, served as chiefs of police in Sweetwater and most recently, North Miami Beach.
Gugliotti is the longtime chief of police in Waterbury, Conn. Hylton, the former police chief in Prince George’s County, Md., is listed as law enforcement advisor to the Federal Emergency Management Agency.
Speziale is the former sheriff of Passaic County, N.J., who later became the deputy superintendent of the New York-New Jersey Port Authority.

Blah, blah, blah...

The selection committee is made of Loftus and Addy Villanueva, now the special agent in charge of FDLE’s South Florida office; Hugo Barrera, the special agent of Miami’s Bureau of Alcohol, Tobacco, Firearms and Explosives...

Sounds good up until here...

...and Maurice Kemp, Miami’s fire chief.

WTF!? 

Chief Mo Kemp

Maurice Kemp, the City of Miami Fire Chief is going to help pick out the next Police Chief?  This would be the same Maurice Kemp who sent his former assistant Fire Chief Veldora Arthur home collecting over $100k while under federal indictment!  The same Veldora Arthur who was rumored to receive preferential treatment throughout her career because of her alleged personal relationship with Chief Kemp?  This guy should be looking for a job himself rather than sitting on a committee that's going to pick out the next police chief!

Committee members will conduct the interviews with five people appointed by city commissioners to ask questions an provide input. But only the four committee members will pick the top five finalists.
From those choices, Manager Martinez will select the next chief.

Another bullshit dog and pony show.  There is no doubt in my mind that Mayor Regalado and his cronies have already picked interim police chief Orosa to be the next police chief, what we're seeing here with this selection committee is a sham proceeding to make it look like Orosa was chosen through a fair and equitable selection process.  Hopefully I'm wrong but somehow I doubt it.

Former City of Miami Assistant Fire Chief Veldora Arthur was paid $120,000 while under federal indictment waiting for trial!

Veldora Arthur

That's right!  While federally indicted mortgage fraudster Veldora Arthur was sitting home out on bail awaiting trial, she picked another $120k from the City of Miami for doing absolutely NOTHING!  From Melissa Sanchez's excellent article from El Nuevo Herald via Google translate...

The City of Miami paid more than $ 120,000 to the Deputy Chief of the Fire Department, Veldora Arthur, waiting at home to be prosecuted for mortgage fraud, even though a rule municipal states that non-union employees should be suspended without pay or transferred when they are accused of a crime.
From February to September, Arthur had to stay home from 8 am to 5 pm Monday through Friday. I could only go out for a lunch break and had to call this office twice a day.

Sorry to hear that Melissa, I don't even get to go out for lunch...

Roberto Suarez, president of the firefighters union, said he did not understand why the City does not reassigned to Arthur while awaiting trial. Arthur was convicted of three counts of fraud on September 30. He was eventually dismissed on October 5.

"Why pay you to do anything when you can put to work"? Suarez said. "Some days? Maybe. Do some weeks? From time to time. But what months? I know of another similar case. "

Not sure what he's saying, I guess Google Translate isn't perfect...

On 3 February, the Federal Attorney's Office charged Arthur and four other people to participate in a mortgage fraud of $ 11 million. Arthur was arrested on February 11 and released the same day on bail of $ 120,000.

The rule states since 1998 municipal non-union employees accused of a crime shall be suspended without pay. Employees cleared of charges should be reinstated to their jobs with back pay. If desired, the administrator can assign these employees to other tasks while waiting for their day in court.

Unionized employees are not subject to the rule, due to different agreements between management and unions. For example, according to a 1989 agreement, firefighters may receive paid leave in such cases. However, Suarez said that in most cases these unionized firefighters are reassigned to other duties.

Arthur ceased to be syndicated by assuming a high administrative position for more than a decade. At the time of his arrest was deputy chief in charge of payroll and quality control.

According to Maurice Kemp, head of the Miami Fire Department, Arthur had been able to recover its previous position of lieutenant, which is covered by the union. If they had, would have decreased his salary of more than $ 184.000. In addition, a pension of $ 167,000.

According to Chief Mo Kemp?  Wasn't that Veldora's boyfriend?

The mayor of Miami-Dade County, Carlos Gimenez, who was administrator and former Miami fire chief, said Arthur could top having lowered to its previous non-administrative position, so that was protected by the union.

After the arrest of Arthur, his superiors took no action. Kemp said he had been evaluating the charges since 12 February.

"Because Arthur had been out of the office on leave, using their personal days for all days but one February, there was an urgency to reach a decision on their status," Kemp wrote in a recent e-mail to El Nuevo Herald.

On 21 February, blogger The Straw Buyer, was the first to write about the case. The next day, the local press started asking questions to Kemp. At that time, Kemp wrote a memo to Arthur allowing you to continue in office even restricting their access to funds these days departamento.En Kemp met with city administrators to determine what to do with Arthur. Both the then manager, Tony Crapp Jr., as the then chief financial officer, Larry Spring, and others involved in the decision said they preferred not to comment on the case. Johnny Martinez, the current administrator, as the Department of the City Attorney, referred questions to Kemp.

On March 2, Spring Kemp sent an email in which Arthur ruled that separate out their duties with pay.

"This is based on our previous conversations and a review of the rule," wrote Spring.

According to Giménez, administrators can exercise their discretion in applying the rule.

"Right, wrong, indifferent, they came to a decision," he said. "Did you follow politics? Yes, because they have that discretion. "

Beverly Pruitt, Director of Employee Relations of the City, said he did not have records of employees who have been placed under license with or without pay because of an indictment.

Suarez said many firefighters believe that Arthur was treated favoritism. He said the media attention on the case determined that perhaps sent home.

 LOL!  Would that be the media attention that we caused?!

"There are many positions to which they could be assigned as being in charge of the 911 call center," said Suarez. "Apparently, someone in the administration of the City does not want to deal with the drama of her in the office."

Kemp said he was aware of the growing media interest, but felt that did not influence the decision.

That's not what I heard MO!

Arthur also took 125 hours of accrued vacation leave in excess of $ 11,000. During the trial, used three-week vacation. Mayor Tomas Regalado said he wants the Office of the City Attorney investigate the issue to see if it can recover all the money paid to Arthur.

"Having been found guilty, she should return the money," said Regalado.

Arthur remains jailed in Miami while awaiting sentencing on December 16. He has hired a new lawyer.

What?  Here we go again with the idiots from the City talking about clawing back hundreds of thousands of dollars only after the money had already been dolled out!  What a bunch of shit.  I don't know what's worse, the Mayor's bullshit reaction about Veldora picking up $120k for sitting on her fat ass at home or the fact that once again to get real news we have to turn to the Spanish language El Nuevo Herald rather than the English language Miami Herald.  FUUUUUUUK! 

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

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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!

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!

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.

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

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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.

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.

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...

JURY FINDS MORTGAGE FRAUD DEFENDANTS GUILTY OF ALL COUNTS IN MORTGAGE FRAUD SCHEME INVOLVING THE HIDDEN BAY CONDOMINIUM COMPLEX IN AVENTURA, FLORIDA

September 30, 2011
FOR IMMEDIATE RELEASE

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.

BREAKING NEWS!!! Veldora Arthur found GUILTY!

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This just in, it's confirmed, city of Miami assistant fire chief Veldora Arthur and her codefendants were all FOUND GUILTY on all counts in their federal mortgage fraud trial!  Here are the verdicts...

Veldora Arthur Federal Mortgage Fraud Trial Verdict

Pamela Johnson Federal Mortgage Fraud Trial Verdict

Neil Fagan Federal Mortgage Fraud Trial Verdict

To put it lightly, the defense team failed miserably.  Detail coming up a little later this evening.