SALT LAKE CITY – Six people, five of whom are from Utah, have been named in a 40-count indictment that alleges the group conspired to defraud more than 10,000 victims in nearly every state, and the indictment states those actions resulted in losses of more than $33 million.
According to a press release from the U.S. Attorney’s Office for the District of Utah, the indicted individuals allegedly set up a business, CC Brown, and offered loan modification services to people who were delinquent on mortgages. The group allegedly used fraudulent and misleading statements to convince customers to pay for their services in loan modification, and in some cases homeowners were foreclosed on while still waiting to hear the results of the loan modification from the company. Federal agents swarmed CC Brown in 2012 to question employees as part of an investigation into alleged fraud.
The indictment was unsealed in court Thursday and names the following: 39-year-old Chad Gettel of Salt Lake City, 43-year-old John McCall of Park City, 24-year-old Noemi Lozana (aka Noemi Sayama) of San Diego, 66-year-old Sheridan Black of South Jordan, 36-year-old James Scott Creasey of Riverton, and 33-year-old Jeremiah Barrett of Bountiful.
The indictment includes charges of conspiracy, mail fraud, wire fraud, telemarketing fraud, conspiracy to commit money laundering and money laundering.
“The defendants here allegedly represented that CC Brown was a business composed of successful lawyers who targeted individual homeowners with the false promise of quality legal representation and legitimate loan modifications,” stated U.S. Attorney Carlie Christensen in the press release. “Their scheme allegedly took advantage of these vulnerable homeowners who were desperate to secure some financial relief and save their homes, but ended up in even deeper financial trouble. The indictment makes clear that anyone contemplating similar crimes will be investigated and prosecuted and warns potential victims to be extremely cautious before paying fees to anyone offering financial rescue.”
The indictment alleges that Gettel and Lozana set up CC Brown LLC in 2009 and allegedly hired attorneys to create a false impression that their loan modification business was a law firm. The attorneys allegedly provided little or no legal services, and instead the work was done by “processors” and telemarketers working for the company.
The group allegedly used third-party call centers to contact homeowners delinquent on mortgages, and the customers were told that the company had a 90 percent success rate in obtaining loan modifications, that there would be legal experts working on the issue, and that they had obtained more than 6,000 successful loan modifications. The press release states customers relied on these “misleading and fraudulent statements in purchasing the services of the loan modification business.” It is further alleged that Gettel and McCall directed telemarketers to sign up every customer who called, regardless of whether or not they would qualify for a home loan modification.
Complaints to state and federal agencies “reflected a pattern of fraudulent conduct.” Customers said they would wait months to hear about the status of their loan modification, and some customers were already in default and continued to be contacted by the lender or debt collector. In some cases, customers lost their homes while waiting to hear word of their loan modification from CC Brown.
The case is being investigated by personnel from the U.S. Treasury’s Office, the IRS, the FBI and other federal agencies, according to the press release.
“Taking advantage of desperate homeowners is a deplorable act,” said Mary Rook, Special Agent in Charge, FBI. “Fraudulent loan modification schemes, which raise false hopes with phony promises of legal representation, take advantage of struggling homeowners willing to do almost anything to save their homes. Individuals committing loan modification fraud profit from that desperation.”
Gettel, McCall, Black, Creasey and Barrett were arrested in Utah Thursday, and an initial court appearance was scheduled for Friday afternoon. Lozano was arrested in Los Angeles and had her initial court appearance Thursday. She was released on bail and must wear a security ankle monitor and is ordered to appear in court in Salt Lake City on March 19.