SACRAMENTO, CA - Charles Head, 40, of Pittsburgh, Pennsylvania, (formerly of Los Angeles and Orange County), was sentenced today by United States District Judge Kimberly J. Mueller to 35 years in prison, United States Attorney Benjamin Wagner announced. A hearing to determine the amount of restitution has been set for November 22, 2014.
In sentencing, Judge Mueller noted that Charles Head had "created and implemented a very cynical scheme" and that Head's life has "shown an inability to respect the law."
In 2013, Head was convicted in two jury trials of two conspiracies to commit mail fraud in connection with nationwide "foreclosure rescue" scams. He was also convicted of seven counts of mail fraud. According to evidence presented at trial and at his sentencing hearing, Head was the CEO of a group of brokerage and financial companies in Orange County and Los Angeles County: Head Financial Services, Creative Loans, and others.
In 2008, a federal grand jury indicted Head and 16 other defendants in two cases, charging them with conspiracy to commit mail fraud, mail fraud, and other charges related to the Head Financial Services equity skimming schemes. The evidence at trial established that the defendants solicited homeowners facing foreclosure, promising to help the homeowners avoid foreclosure and repair their credit. Instead, through misrepresentations, fraud, and forgery, the defendants led the victims to complete transactions that substituted straw buyers for the victim homeowners on the titles of properties without the homeowners' knowledge. These straw buyers were often friends and family members of the defendants, or were solicited on the Internet. Once the straw buyers were on title to the homes, the defendants applied for mortgages to extract the maximum available equity from the homes. The defendants then shared the proceeds of the ill-gotten equity and the "rent" that the victim homeowners paid them. Ultimately, the victim homeowners were left with no home, no equity, and with damaged credit ratings.
Initially, Head focused his scam on distressed homeowners in California before expanding throughout the United States. In the course of the schemes, between January 2004 and June 2006, the defendants obtained over $90 million in fraudulent loans, caused estimated losses of over $50 million, and stole title to over 300 homes.
Head and his brother Jeremy Michael Head, 34, of Huntington Beach, were convicted in May 2013 following a nearly four-week trial. A second trial was held in December 2013 that lasted five weeks. Head and two other defendants were convicted.
U.S. Attorney Wagner said: "This defendant purposely targeted the financially vulnerable during their time of greatest distress with promises of help. Then he tricked them into handing over their most valuable asset, their home. When victims in one scheme grew scarce, he opened up a new scheme drawing in victims from across the country. Few economic crimes are more reprehensible. No sentence will undo the damage wrought by Charles Head and his fellow scammers, but today's sentence brings a measure of justice for their victims."
"In large fraud schemes like the one devised by Charles Head, we can't forget about the individual homeowners who comprised the more than $50 million in losses," said Monica Miller, Special Agent in Charge of the Sacramento division of the FBI. "Today's sentencing ends an investigation that has been ongoing for more than 10 years and brings some closure to the innocent people who were victimized by Head's callous scheme."
"The defendant preyed on struggling and trusting homeowners, literally stealing the American Dream out from under them, with no remorse," said Jose M. Martinez, Special Agent in Charge, IRS-Criminal Investigation. "Today's sentencing signifies the continued effort by the IRS, FBI and U.S. Attorney's Office to investigate and prosecute those who commit mortgage fraud. IRS-CI is committed to pursuing those who line their pockets with profits from these schemes."
This case is the product of an investigation by the Internal Revenue Service-Criminal Investigation and the Federal Bureau of Investigation. Assistant United States Attorneys Michael D. Anderson and Matthew Morris are prosecuting the case.
Sixteen other defendants have also been convicted in the two related cases and are awaiting sentencing:
Elham Assadi, aka Elham Assadi Jouzani, aka Ely Assadi, 34, of Irvine, California; Leonard Bernot, 54, of Laguna Hills, California; Akemi Bottari, 32, of Los Angeles, California; Keith Brotemarkle, 46, of Johnstown, Pennsylvania; Benjamin Budoff, 47, Colorado Springs, Colorado; Joshua Coffman, 34, of North Hollywood, California; John Corcoran, aka Jack Corcoran, 56, of Anaheim, California; Jeremy Michael Head, 34, Huntington Beach, California; Sarah Mattson, 31, of Phoenix, Arizona; Domonic McCarns, 40, of Irvine, California; Omar Sandoval, 36, of Rancho Cucamonga, California; Xochitl Sandoval, 33, of Rancho Cucamonga, California; Lisa Vang, 28, of Westminster, California; Andrew Vu, 43, of Santa Ana, California; Justin Wiley, 32, of Irvine, California, and Kou Yang, 36, of Corona, California.
In addition, defendant Ahn Nguyen is pending trial and defendant Domonic McCarns is awaiting a second trial on additional charges related to these offenses. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case was part of the President's Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys' offices and state and local partners, it's the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. For more information on the task force, please visit www.StopFraud.gov.
Link: https://www.sacbee.com/news/business/article2608541.html
