Straw Buyer Who Participated in Foreclosure Rescue Scheme Enters into Consent Judgment with Attorney General Martha Coakley's Office
On March 30, 2007, the Attorney General's Office filed a complaint against Francis and 18 others who participated in a foreclosure rescue scheme. The complaint alleges that the defendants not only obtained the titles to the homeowners' residences but also stripped most of the homes' equity by failing to account for deposits and other monies due from the buyers, disbursing sale proceeds for unearned brokers' fees and other fictitious services, and drafted and submitted to lenders HUD Settlement Statements that did not accurately reflect the disbursements made in the transactions. In certain cases, the defendants allegedly resold the homes in multiple transactions amongst themselves, thereby stripping the homes of all their equity. According to the complaint, Francis received a payment for allowing the defendant mortgage brokers to use his in name in applying for a loan to purchase one of the properties identified. Contrary to representations made to the lenders in the completed loan application, Francis took title to that property without paying any deposits or closing costs, and without intending to occupy the property.
The consent judgment, filed last week in Suffolk Superior Court, provides for a payment of $5,000 in restitution and $1,500 in attorneys' fees and costs. Francis is also prohibited from acting as a straw buyer or otherwise obtaining loans through misrepresentation.
Francis is the third defendant and second straw buyer out of the original 19 defendants to settle allegations over his role in this foreclosure rescue scheme case. In August, the Attorney General's Office reached a similar settlement with straw buyer Marie Betey Mereus.
Additionally, this past June, the Attorney General's Office reached a settlement with closing attorney Valerie Hanserd providing for a payment of $115,000 to resolve allegations over her role in both this foreclosure rescue scheme case and a second related enforcement action against her and Leo Desire Sr. and Primary Mortgage Resource, Inc. In that second case, the Commonwealth alleges that the defendants together altered a deed from the Federal Home Loan Mortgage Corporation (a.k.a. "Freddie Mac"). That case was tried against remaining defendant Primary Mortgage Resource, Inc. in June of this year and remains under advisement.
This case is being handled by Assistant Attorneys Generals Gillian Feiner, Amber Anderson Villa and Stephanie Kahn, and Paralegal Yolanda Kruczkowski of Attorney General Coakley's Consumer Protection Division with assistance from Investigator Nancy Ward.