Tuesday, February 03, 2009

Your Bailout Money At Work: $1 Billion Fraud In Sacramento

A 27 year old Sacramento-based mortgage broker has come clean on his website to the tune of nearly $1 billion in fraudulent loan originations. Excellent coverage by News 10 and the Mortgage Fraud Report. Here's an excerpt from his 7-page mea culpa:

Our company boasted region-best 30,000 square feet, 120 employees, and handling a monthly gross revenue over $5m. Fraud was rampant. We found investors that were not re-pulling credit reports, so we would change a 500 fico to a 700 fico, a person in foreclosure and make It look like they were never late, fake w2s, pay stubs, bank statements, verification of deposits, none of which was being re-verified. These investors, who were securitizing these assets as AAA rated were not even verifying anything in the files? I am sure that their investors were assured everything from correspondents was being audited. Every time a lender caught a file we would "fire" the employee produce termination paperwork to the investor, and re-hire the employee under a different alias. Over the course of the 3 years, over $810,000,000 in mortgage backed securities originated from my companies. That's a 24 year old selling a billion dollars in bad mbs securities which by 2008 were in default with out doubt.
Just remember, when the politicians wax poetic about "rescuing" the banks, this is what your tax dollars will be buying.

12 comments :

patient renter said...

Wow, now that was interesting.

Max said...

Yeah, I thought so. The guy obviously still has a high opinion of himself; I'm sure Tanta would have taken him to the woodshed over his proposed remedies. The fact is, this guy isn't a brilliant operator. He was a creation of the relaxation of underwriting standards, and the willful blindness of the big banks. He was the crack dealer on the corner: despicable, sure, but not a root cause of the problem.

The guy obviously wants a deal of some kind (book, movie, FBI).

patient renter said...

The guy obviously wants a deal of some kind (book, movie, FBI).

I couldn't help but think of the movie "Catch Me If You Can". He must be thinking, if it worked for that guy...

Keith said...

Agreed. This guy came across as excessively full of himself.

I'd say the main reason he was a successful fraudster isn't because he's brilliant, but because he has no morals.

My vote is that he's after a movie deal, given the 'Boiler Room' reference.

patient renter said...

My vote is that he's after a movie deal, given the 'Boiler Room' reference.

No doubt I'm sure something along these lines will be made. The bubble and collapse were too massive for hollywood to avoid.

patient renter said...

Someone just forwarded me a hiring announcement e-mail from a CA State Agency. I wish I was joking.

Max said...

Someone just forwarded me a hiring announcement e-mail from a CA State Agency. I wish I was joking.

What you're seeing is the byproduct of the mass confusion that is the state leadership right now. I'll have more later.

Anonymous said...

Let him go to prison with the rest of the murderers and rapists. If three strikes lands you in hard core prison for petty theft, surely a billion dollar fraud deserves better than a country club prison.

Make all white collar crime above a certain value eligible for gen pop incarceration and I'll bet it won't seem as fun.

HoweBoutArden said...

This is getting juicy… This thread is from a Mortgage Forum starting mid December. The people are discussing problems they are having getting their loans funded. It even includes comments from Christopher himself. Man is this guy is a piece of work.
http://mortgagegrapevine.com/thread/?thread=549693

Why has this not main stream meidia in a bigger way?

“I think I’ll call him mini-Madoff “

Wadin' In said...

HoweBoutArden,

Hilarious. You know the last few posts are Warren, because he writes "Medoff ran a multi-level panza scheme...." On his web site rant he uses "panzi", so he is getting closer to "Ponzi" each month. The real winner post is the one by ChrisWarren4Pres....

This is just fascinating.

Max said...

Looks like the douche fled the country on his private jet just before the IRS got an indictment. I wonder where he'll turn up...

Joe Aldeguer said...

I love that movie (from the picture attached). Interesting post.