4 Orange Countians Tied to Excel Investments Arrested for Alleged 3-State Condo Bailout Scam
Arrested were: Aref Abaji, 31, an Aliso Viejo real estate agent; his brother Maher Obagi, 26, of Huntington Beach; Jacqueline Burchell, 52, an Orange escrow agent; Mohamed Salah, 37, of Mission Viejo; and Mohamed El Tahir, 35, of Glen Burnie, Maryland. A sixth suspect, mortgage loan officer Wajieh Tbakhi, 48, of Corona, is being sought by federal authorities.
All are charged with conspiring to commit bank fraud and wire fraud, and Abaji, Obagi, Tbakhi and Burchell are additionally charged with six counts of wire fraud. The conspiracy charge carries a maximum sentence of 30 years in federal prison and a potential $1 million fine. The maximum sentence is 20 years and a $250,000 fine for the wire fraud charges.
The Orange Countians pleaded not guilty at their arraignment Wednesday in U.S. Magistrate Judge Robert N. Block's courtroom, where trial was set for March 5. All were scheduled to have been released from custody by now. El Tahir had a court appearance pending this afternoon in Baltimore, Maryland.
According to an indictment returned by a federal grand jury in Los Angeles on Friday, the scheme worked by identifying new condominium developments in Florida, Arizona and California where the builder-owners were struggling to sell units. Excel Investments arranged to sell the condos, which benefited the builders because it appeared units were moving and maintaining their value while the sellers enjoyed hefty commissions.
But the condo buyers were straw buyers--scam participants, their relatives or "investors" attracted to a no-money-down vehicle that promised steady rental payments--recruited solely to qualify for financing by fabricating employment, income and asset details on loan applications, according to the indictment, which further charges fabricated and altered W-2 forms, pay stubs and bank statements were submitted.
The investigation by the FBI, IRS and Federal Housing Finance Agency's Office of Inspector General tracked more than 100 fraudulent transactions that earned the defendants commissions of $50,000 to $100,000 (and sometimes more) that they sough to conceal as "marketing" fees, according to the U.S. Attorney's LA office.
After loans defaulted and fell into foreclosure, lending institutions suffered losses of at least $6.2 million, and Freddie Mac and Fannie Mae lost at least $2.37 million after picking up the bad debt of second mortgages, the indictment alleges.
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