Men plead guilty in real estate scam
A Costa Mesa man and three Irvine men were convicted of defrauding hundreds of victims in a multistate real estate scam, authorities said Thursday.
Justin Dennis Koelle, 23, of Costa Mesa, and Jacob John Cunningham, 26, and John D. Silva, 28, both of Irvine, pleaded guilty Wednesday to one felony count each of conspiracy to collect illegal upfront fees and conspiracy to commit theft by false pretenses, according to the Orange County district attorney’s office.
Dominic Adam Nolan, 32, of Irvine pleaded guilty to one felony count of conspiracy to collect illegal upfront fees.
Prosecutors said the four men — as well as Andrew Michael Phalen, 26, of Mission Viejo — between January 2009 and March 2012 created several loan modification businesses in a scheme estimated to have taken more than $130,000 from hundreds of victims throughout California and out of state.
Using the fake businesses, the men sent out promotional letters — designed to look like they were from the victim’s lender — containing offers to restructure home loans. The letters referred to the homeowner’s lender and principal balance, prosecutors said, and charged upfront fees while boasting more than a 95% success rate.
The men told the victims they could get a refund of the fee if their loan wasn’t modified, prosecutors said, but instead they kept the money and performed no services.
The five men frequently changed the names, phone numbers and addresses of their companies, according to the D.A.’s office.
By December 2011, after victims submitted official complaints about their businesses, Cunningham, Nolan and Silva also started a new scheme with letters that contained a CitiFinancial or CitiMortgage logo.
Phalen pleaded guilty in June 2012 and was sentenced to a year in jail.
Koelle, Cunningham, Silva and Nolan are scheduled for sentencing July 29 at the Central Justice Center in Santa Ana.
Koelle is expected to serve nine months in jail. The other three could receive six months in jail.
All five will have five years of formal probation, pay restitution and be prohibited from having any loan modification or consulting practices, prosecutors said.
