3 sentenced in mortgage fraud scheme

A federal judge sentenced three men for running a foreclosure rescue scam in Bakersfield and two other California cities.

Martin Calzada, 30, of Norwalk, was sentenced to nine years in prison; Juan Curiel, 38, of Visalia, was sentenced to three years and five months in prison; and Santiago Palacios-Hernandez, 48, of Salinas was sentenced to two years and nine months in prison by a federal judge in Fresno.

The three were also ordered to pay more than $1.1 million in restitution to victims and federal mortgage lenders Fannie Mae and Freddie Mac.

In March, Calzada was convicted on one count of conspiracy and eight counts of mail fraud in operating Star Reliable Mortgage that also had offices in Visalia and Salinas. Curiel and Palacios-Hernandez pleaded guilty conspiracy to commit mail fraud affecting a financial institution in December 2014.

Federal prosecutors argued the three targeted homeowners facing foreclosure with a fraudulent "loan elimination" business that required homeowners to pay upfront fees for the fraudulent services ranging from $2,500 to $4,500 and other monthly fees.

Prosecutors also argued that the scheme involved filing fraudulent documents that would replace legitimate property trustees with fictitious trusts in order to stall the foreclosure process.

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