Here is a great example of a
fraud investigation that ended the career of one scammer who managed to steal
in excess of $90 million and titles to over 300 properties by preying on
people, who tried to avoid having their homes foreclosed by using his deceitful
services. In 2014 a Mr. Head was finally sentenced to 35 years behind bars
after a lengthy trial. The Department of Justice had investigated him since
2004 and brought charges in 2008 to him and 16 other defendants for their roles
in one of the more brazen nationwide schemes in the history of fraud
investigation to scam hundreds of home owners out of their houses and savings.
The fraud investigation figured out that the scam worked as follows. Mr. Head and his associates would pretend
to buy a property by faking and loan documents and using fake checks. Once they
got the title from the owner, they would immediately take out reverse mortgages
backed by the equity of the property. They then would transfer the money
offshore and disappear, often keeping the title and all the cash, but leaving
the original owners with bounced checks and enormous amounts of debt leaning on
their residence.
The victims in most of the
instances, where approached because they were facing imminent foreclosure. They
surrendered vital documents, when Mr. Head’s organization promised to help them
refinance their mortgages. Instead the documents were used to change title
ownership, draw loans and sell the property, often several times over, before
the actual owner would be thrown out on the street in disbelief. Ironically,
before finding out the hard way, most of the victims actually paid the crooks
for their services in monthly installments akin to rent. In the end however,
the fraud investigation revealed that all were left with no house, no money and
a seriously damaged credit rating.
The judge in the case called it a
very cynical and disgusting display of disrespect for the human condition and
struggles of others. Simply, these criminals had no ethics or empathy for their
victims, many of whom were families with young children. They preyed on the
most vulnerable members of society, people who were already struggling to pay
the bills, offering help only to steal their last remaining possessions and all
of their property. This fraud investigation took over four years because off
the number of scammers involved, their geographical distribution and enormous
amounts of losses for victims.
This fraud investigation was
initiated by the IRS in partnership with the FBI. They gathered evidence for
two years, using undercover agents posing as homeowners as well as other
tactics to gain indisputable proof of Mr. Head’s activities. Then the case was
passed to the Attorney General’s office for prosecution. The Stop Fraud task
force was also involved in bringing down Mr. Heads organization. It employed
the resources of nearly 20 other government agencies in order to apprehend the
17 defendants and bring them to justice. As things stand the criminals have all
gone to prison for variously long terms and the ringleaders are having to pay
restitution to the victims to the tune of $50 million.
