San Diego Housing Bubble News and Analysis

Another article, this one from PE.com. New lawsuit by a Rialto couple.

Investors file federal fraud lawsuit
http://www.pe.com/business/local/stories...

Mostly stuff we've heard already ... here's the new stuff:

(snip)
The plaintiffs in the latest suit, Anna Richter and Deborah Weber, said they were persuaded by the defendants to extract all the equity from their homes, which was subsequently wired to accounts that the defendants controlled. They never received the promised returns, the suit said. ...

Richter said in an interview Monday that she became an investor with Pacific Wealth in April on the advice of a friend from church. Richter, 39, who until recently was a senior chemist at California Steel Industries in Fontana, said she and her husband, Mark, 44, a senior inspector for California Steel, hoped their investment profits would enable Mark to go into the ministry.

Richter said she borrowed $187,000 on their house in Rialto that Pacific Wealth used to help her and her husband buy three more homes. In addition, she said, Pacific Wealth opened credit cards in her name on which she borrowed $76,000 in cash. She said she invested that and another $15,000 from her 401(k) for a six-month investment that Pacific Wealth was touting in foreign currency.
(snip)

That "foreign currency" is the Iraqi dinar ...

I happened to notice on foreclosure.com that Hendrix Montecastro has a NOD for a condo out 4S Ranch way. Looks to me like this scam might not just be limited to the Murrieta and Temecula areas...

He actually put $150K down on that one. I guess he figured he deserved to buy a $1.4M pimp palace after all his handiwork up the road.

I have seen a list of several hundred properties involved in the case. There are a couple of loans in SD County, a couple in Orange County, and a couple in Arizona, but 98% of the properties in this list are in Murrieta, Temecula, or areas very nearby, like Wildomar and Lake Elsinore.

The only thing I really want to know is where the actual price of the properties "bought" under this scam actually end up.

50% or more below their fraud buy price seems reasonable given,

1. the last sale was fraudlent and potentially envolved 10-20% cash back or a known ability to future fraud it for 10-20% cash on a refi.
2. the only reason the home sold at all was it was involved in the scam.
3. some neighborhood 'blocks' have as many as five homes involved in the scam. Literally, one scam price inflates the next scam price.

If you look to Murrieta, the condos in Ladera Ranch, parts of San Marcos and potentially 4S ranch the story is the same, fraudulent sales setting the comp price for more fraudulent sales.

So if fair market value is approaching 50% or so, what's the REO going to go for if they have to clear several hundred out in a few cities?

The appraisers involved in bringing in high appraisals in a
declining price market should loose their license,along with the fraudster realtors.

You want to learn more about this scam or are a victim please check out this site for the latest details.
http://www.coreclient.110mb.com

These folks are fighting back. Good for them I hope they stick it to the fraudsters. The fraudsters need to go to jail for a long time. http://www.coreclient.110mb.com

Hey Core!

You ol' flipper rascal! Long time no smell.

How's your real estate scam / get rich quick scheme going these days?

He's got links on his site to some specific threads here and it looks like he's spamming all the dead horse threads. I can't figure out why, nothing we can do to help. If he really wants to fight back he needs to start making some dogfighting allegations against them. They do have pictures on their sie of the swindlers, nothing like what I expected and a few looked like they just got out of jail so going back shouldn't be any big deal. I know looks can be decieving but I wouldn't trust some of them with my car when I valet park, let alone my money.

I call BS on these 'victims' - Is it not possible to pay for seminary on less than $187,000? Or maybe that's not what they meant by 'ministry' . . .

Yo buttbuyerwillepb,
Learn the facts, I did not purchase any props...I was involved in securities that I never received....Gave $$$ and got nothing in returned....So you want to be sarcastic throw stones do your due diligence (as I have heard from you guys) before you start judging me, look in the mirror.

r/
cORE

Core,

One more thing. Here's a suggestion for the "victims" in your webpage pics and videos. Next time you go out looking for sympathy, take off all that gold jewelry, and expensive bling that you bought with your ill gotten riches.

F***ing Flippers.

What Bling??

Oh...the bracelet, ring, and wedding ring? Bought 6 years ago...wayyyy before this and not worth very much.

Not a ONE of us 'VICTIMS' bought ANYTHING with any ill-gotten gains.

Cause all we did was GIVE...we never took nor received.

There's no Escalades in the driveway or plasma screens in our home. We took no fancy vacations (my last 2 vacations were tent camping...is that humble enough for ya?). But James Duncan does...every month...on the victims' dime. He goes to Hawaii and Europe. His 16yo stepkid drives a Navigator.

Until we trusted the wrong crooked people, we paid cash for everything, had a high FICO score, and managed our money well. Now...the only thing left is Bankruptcy.

I think we have been punished enough.

http://www.pe.com/reports/2007/wealth/

Conned by Crooks, you have been punished that much is for certain. Whether its, "enough" is merely a matter of perspective. I don't know the details of the scam but these types of scams appear in every boom cycle, and the suckers, ahem I mean investors always get fleeced.

The only good thing that will come out of this whole sordid affair is that maybe those around you will learn from your hardship and not make the same mistakes. Everyone pays. You lose money, maybe even your house. The banks are left with REO's that no one will purchase at the prices owed against them. People like me are left out, unable to afford buying a home at all. Somehow everyone gets stuck with the bill.

It sounds like the scam artists have spent the money, so how can you possibly get it back? Even more interesting to me is why these scams are often so tightly coupled with churches as in, I met these people through church. Does church make people appear more trustworthy?

Josh

I guess if presented by a church person does. It was presented to me by someone so dear to me, I can't even fathom the betrayal. Even then I was against it. It's hard to explain, but they appeal to you on a much different level..a level that hits the heart strings of what good you can do whith the money that is made.

It is our belief that they have squirreled away some assets. Am praying a Receiver is appointed and that everything own will be frozen, sold, and divided among the victims.

We have started a non-profit foundation called Citizens Against Fraud Foundation and hope to be able to educate others about mortgage fraud, ponzi schemes, proper questions to ask when obtaining a mortgage, anything that would Prevent this from happening to someone else.

I guess we never wanted to be seen here as a bunch of belly-achers/victims...more of trying to get the word out to help stop these guys. Nothing short of silver bracelets and a jail cell will stop James Duncan and his gang.

We just don't want to see anyone else victimized...whether they are smart or stupid, deserve it or not.

Law Enforcement has really been very slow...so slow others are sucked in daily. Contact the SEC in La. Contact the Riverside DA, Contact the FBI and SS, and Riverside Board of Supervisors..they have collected money to combat this...almost $8mill and not a lot has been done. It shouldn't take 12 years to bring this to trial.

No one deserves to go through this.

Is there any way anyone can help us?

It's hard to explain, but they appeal to you on a much different level..a level that hits the heart strings of what good you can do whith the money that is made.

no blames here. let's try to understand your point of view. So exactly how much money was promised to you. to each of the investors? and why was it such a good investment? where was all the profit going to come from?

Dear Conned by Crooks,

I feel so bad for you and your friends! I just can't understand how something like this could happen and how those awfull people could get away with that, I am truly so sorry.

You and your friends are welcome to join my Church, I am the priest, and all of my children are making hundreds of thousands of dollars, and life is grand.
I would love to sit you down and explain how I can help uou make back all of those funds you lost and make much more, it is a very complicated to explain, but I am a man of G-d so you can trust me.
Please let me into your heart so I can help you onto the path of great wealth.

"Does church make people appear more trustworthy?"

Or are people who believe in religion just gullible and naive?

"Does church make people appear more trustworthy?"

Or are people who believe in religion just gullible and naive?

===================================

Actually the answer is yes to both, and I am a christian. However the answer is yes not because they are religious but because they are human. This is part of the human existence to want to believe that they are a part of something great. Mentally speaking the phenomena is not much different than poverty pimps or extreme animal rights types. (really I could name any sacred liberal cow).

It would be easy to play the same game with any group of people bonding together for some common interest (liberal/conservative/secular it doesn't matter)

How many union members believe their leaders are doing the right for them? There is an implied trust that sometimes imperfect humans seem to break. Most union bosses really are leading with the rank and file in mind, but are there not bad seeds at the top with selfish interests? Are union members gullible if they have a crook running things?

Cardiff, great point, scams often require trust. Familiarity or similarity is the favored route. Race and Religion are common factors, many victims of any scam are lulled into it because the scammer has something in common with them in order to break down their defenses. Even most crimes are commited within one's social, racial or religious group because people let down their guard when dealing with one of their own.

Conned, don;t worry about raising too much money for the education campaign to protect others, I'll give you the entire program for free. It's a two step, 30 second program.

"Don't buy what you can't afford."

"Always look for investments, never let them look for you."

You can even perform a scientific test with a small sum of money, let's say $200. Invest $100 in something you find (an account or bond at the bank, a stock or index fund that you research and buy online) and invest the other $100 in something an a friend, aquaintance or telemarketer presents to you when you weren't looking for it. After five years, see which one has more value, it will be the one you found and not the one that found you. $200 and you will have learned more than I learned in college, try it.

Conned, don;t worry about raising too much money for the education campaign to protect others, I'll give you the entire program for free. It's a two step, 30 second program.

"Don't buy what you can't afford."

"Always look for investments, never let them look for you."

You can even perform a scientific test with a small sum of money, let's say $200. Invest $100 in something you find (an account or bond at the bank, a stock or index fund that you research and buy online) and invest the other $100 in something an a friend, aquaintance or telemarketer presents to you when you weren't looking for it. After five years, see which one has more value, it will be the one you found and not the one that found you. $200 and you will have learned more than I learned in college, try it.

That's in interesting way to look at it. I'm going to have to quote you on that from now on.

TG: I realize that we are discussing the Temecula/Murrieta scam here, but doesn't this apply to the California RE market as a whole? Between home builders, realtors, mortgage brokers and institutions, this whole market was one gigantic Ponzi scheme, and now it is collapsing.

While I can certainly understand the anger and humiliation of the Core "victims", they aren't any different from the other so-called "victims" of Countrywide, or Century 21, or First American Title.

Buying a home is a huge financial commitment; probably the largest one you will ever make. To not do basic diligence and ask a fairly simple set of questions smacks of nothing other than shame-faced greed.

As the old man used to say, "If it sounds to good to be true, it is." Or better yet, "If it walks like a duck, looks like a duck, and quacks like a duck: It's a duck.".

There is a sucker born every minute, and it seems like they all decided to move up to the Temecula area at the same time.
They were promised financial independence in 3 to 5 years.
Sounds like greed to me...
and greed always overwelms common sense.
Actually sounds like a good strategy that these "victims" do all they can to focus on the obvious scumbags, and use their kids as "victim" props.
This way the authorities will not focus on any of the fraud that some of the "victims" may have done in getting 5 to 10 houses. The real victims are the banks, and the homeowners who actually bought homes to live in at the fraud level comps.
These so called "victims" are only fools, some criminal fools, some just plain fools. They deserve nothing, but a deep investigation of what they signed, and what was the understanding that they though they could get from a bank 5 to 10 mortgages, all within a short period so the banks could not catch multiple applications, thus fraud.

Who cares what these fools were promised. haha, they did not even get it in writing for gosh sakes, haha

The people who created and carried on the main fraud should most certainly be brought to justice, but these so called victims deserve nothing, but a shift kick in the A$$, and a hasta la vista, and they should thank their happy stars that they are not also being investigated for fraud against the banks themselves.

the homeowners who actually bought homes to live in at the fraud level comps

your 100% right bro, these are the real victims, core client, conned by crooks and all there friends should be held responsible for compensation to these people.

Core client, Conned by crooks, plain and simple you and all your friends that thought you found someone that was going to make you rich are total IDIOTS. Come on looking back now don't you agree you were stupid to do what you did?

Had this scam you were involved in actually gone your way and you all had made some money, would you be complaining, why do you not ask your selves this one question??????

all of you involved with Hendrix Montecastro, Maurice McLeod and James Duncan should be held with as much responsibility as them, I only hope they hold all of you responsible for the documents with your signitures.
What kind of friggen idiot's gives someone they don't even know tens of thousands of dollars, then sign fraudulant mortgage documents then claim they were scamed!!! you weren't scamed you were GREEDY MOTHER F*^%$#S, you all deserve what you got, and I hope you get arrested for mortgage fraud as well.

Call all your friends and family in the Philippians and tell them how easy it to get rich in the USA, tell them they are giving away houses in California, bring them all down and introduce them to Hendrix Montecastro, Maurice McLeod and James Duncan they'll take real good care of them.. the bottom line you could come visit me at my Church, I know a way you could make back all that money you lost, within 3 to 5 years you will have financial independence, I promise, just give me the seed money to get it started.

oh yeah sorry, Conned and core, thank you very much for your help in inflating the Murrieta real estate values, I made out very well selling my home back in 2006, thanks!

It won't be me doing time.

I did nothing wrong.

If you feel otherwise, call the Riverside DA. If Duncan, Montecastro, and all of them are still running around after having stolen hundreds of millions of dollars from INNOCENT victims, I certainly have no fear as I can PROVE that I never profited, only LOST. Call the DA, SEC, FBI, CDC, and DRE...let them know how upset and pissed you are that they haven't locked us up, the people who have lost everything...tell them how proud you are that Duncan, Montecastro, et al still walk the streets among you and have never been held accountable.

Your hatred is misguided and misdirected. The malice that drips from the keyboards indicates other issues in your life.

You Still don't get it...the Bad Guys STILL don't get the blame for their THEFT and Chicanery, just keep blaming the VICTIM.

We certainly don't need validation from you.

But if you got off your high horses for a moment, instead of patting yourselves on the back declaring your own superiority, there still remains the fact that people are primarily uneducated about real estate and ponzi schemes. Normal, regular people need to know what to watch out for. Maybe they are out being experts in their own field, what's the point in hiring 'anyone' in the real estate profession if you need to become your own expert? That's like telling me I need to know enough about medicine to operate on myself, and if I can't, I didn't do due diligence. How silly is that? Your arguments do not hold up.

Now, have a nice day.

Conned, I'm not blaming you but I'm also not letting you "only" blame others. You got taken by the scheme, I didn't and I am not an expert in the field nor does my job have anything to do with R/E or finance. Your analogy about having to become an expert in medicine is flawed. You need to know the basics, two aspirin if you have a headache, a hundred might kill you. That's a more accurate analogy of someone making 100k a year buying a few million in R/E with borrowed money. You now have a circle of friends within the support group of victims but don't think they are indicative of all non experts, they aren't. The vast majority of people don't fall for this because they were given pearls of wisdom from their parents, grandparents or mentors. "There's no such thing as a free lunch," "If something is to good to be true, it is," and "Don't bite off more than you can chew." These cliches are cliche because they are true, they have always been true and they always will be. No matter how you spin it, no matter who you try to "educate," you will never learn your the lesson you already paid for until you look in the mirror. There is a reason my grandmother doesn't drive on the freeway, she lacks the skills and her vehicle lacks the ability to drive 80 mph, when she does it everyone honks at her and she runs the risk of getting killed. Either learn from your mistake, educate yourself that even if these people were honest there is no way for you to skip business school and become a tycoon, stay on the surface streets and next time you try for the freeway, start off in the slow lane.

Conned by Crooks: What about asking simple questions? I understand and don't disagree with your point regarding a general lack of education in real estate, but what about basic math?

Not to sound like a smarta** here, but why weren't you and the other participants asking questions about the "deal", and how this whole scheme worked?

There are Harvard MBAs working on Wall Street that don't have the expectation of financial independence in three to five years. I would think buying into a get-rich scheme piloted by the likes of Duncan and Montecastro, two individuals with little to no experience as financiers, would have drawn at least some suspicion when it came to their claims. Because it didn't, I have to fall back on the belief that this was nothing other than simple greed. All the education in the world doesn't help when greed overwhelms your common sense.

"No warning can save a people determined to grow suddenly rich". Lord Overstone