Nevada Attorney Indicted In Foreclosure Rescue Scam

Three people, including a Las Vegas attorney, have been indicted for allegedly operating a foreclosure rescue scam in Las Vegas during 2008 and 2009.

The indictment alleges that Nevada attorney Ramon Dy-Ragos, along with his partners Jesus Baca a.k.a Jesse Baca and Luis O. Baca, operated a foreclosure rescue scam under the business name of  "Save Your House."

Save Your House is alleged to have lured customers to pay large up-front fees - ranging from $1000.00 to $3995.00. The defendants informed the victims they could prevent foreclosure by having customers stop paying their mortgage and ceasing all contact with the bank holding their mortgage.

The defendants falsely claimed they would modify mortgages through negotiation with the mortgage holders or suing the mortgage holders. Nevada has one of the highest foreclosure rates in the nation.

"We need citizens to help identify mortgage fraud scams such as these so we can investigate and prosecute these individuals," said Nevada Attorney General Catherine Cortez Masto.

Dy-Ragos and Jesus Baca are indicted on two B felony counts of theft. Luis O. Baca is indicted on one Gross Misdemeanor count of conspiracy.

The case was investigated and is being prosecuted by the Attorney General's Mortgage Fraud Task Force within the Bureau of Consumer Protection.

Protecting yourself

Mortgage modification and foreclosure rescue scams come in a variety of guises, but some of the common ones include:

• Upfront Fee Scam. Fraudster promises, for an upfront fee, to negotiate with homeowner's bank to pay down back-payments, but scammer ultimately takes the money and disappears.
• Lease-back or repurchase scams. Con artists promise to pay a mortgage and lease it back to their victims if the consumer signs over the deed. The scammer then raises the rent, sells the house, steals equity, or even evicts the tenant.
• Refinance fraud. Victims sign over ownership of the house, thinking they are signing documents for a new loan at a lower payment level.
• Bankruptcy schemes. The scammer encourages the victims to stop paying their mortgage and offers to file bankruptcy for the consumer, for a fee.

Appraisal fraud. An appraiser " in cahoots with a bank " overvalues the home, then secures an unnecessarily large loan at high interest rates for the homebuyer. Another scenario is that the appraiser undervalues the home in order to justify a short sale and subsequent re-sale at market value for profit.

"Recent multi-agency federal and state actions to tackle the threat of mortgage fraud are a positive step in helping to protect consumers," said National Consumers League Executive Director Sally Greenberg, in a 2008 interview. "Fraudsters should be apprehended and brought to justice. All too often, however, victims of these schemes have already been ruined financially by the time mortgage fraud rings are broken up by law enforcement. Now, more than ever, enforcement should be tied to prevention by devoting more resources to educating consumers through churches, community centers, senior centers, schools, and libraries. This is needed particularly in vulnerable low-income, elderly, and immigrant communities, whose members are frequent targets for mortgage fraud."