Monday, January, 25, 2010
Irvine Attorney, Business Partner Arrested for Loan Modification Fraud
By a MetNews Staff Writer
An Irvine attorney and his business partner have been arrested for defrauding over 400 victims in a $1.25 million loan modification scam that targeted distressed homeowners, the Orange County District Attorney’s Office said Friday.
Prosecutors said inactive attorney Christopher Lee Diener, 42, and his partners Stefano Joseph Marrero, 40, and Terrence Green Sr., 43, are each charged with one felony count of conspiracy to commit grand theft and 97 felony counts of grand theft by false pretense.
They also face sentencing enhancements for white collar crime and excessive taking, and, if convicted, could receive a sentence ranging from probation up to 70 years in state prison.
Diener and Green were arrested this morning and are being held on $1.5 million bail each. They must prove the money is from a legal and legitimate source before posting bond, and prosecutors said the two are expected to be arraigned tomorrow. A $1.5 million warrant has been issued for Marrero’s arrest.
Beginning in March 2008, the defendants allegedly defrauded hundreds of victims by offering loan modification services in exchange for advance payment.
Marrero and Green were business partners and Diener acted as attorney for their businesses. The three are neighbors in Ladera Ranch and are accused of operating loan modification businesses under the names Home Relief Services, LLC, US Loan Mod Processing, HRS Communications, The Diener Law Firm, and Diener Law Group.
Diener, Marrero and Green are accused of making false statements to entice customers to use their services, and then failing to provide the services after customers paid. In total, prosecutors say, they fraudulently took $1.25 million, including over $350,000 from credit card companies who had to refund cardholders to compensate for the fraud.
The defendants are also accused of soliciting the referral of clients in exchange for payment by approaching local and national real estate brokers and professionals and promising to pay fees for each customer referred. They allegedly traveled to a mortgage bankers’ convention in Las Vegas at one point to solicit referrals from industry professionals with the promise of payment.
As a result of the alleged scam, the California Department of Real Estate took action against Marrero and Green last February, issuing an order to desist and refrain from soliciting clients.
Diener was involuntarily enrolled as an inactive member of the State Bar of California in October after the group found that his conduct posed “a substantial threat of harm to his clients or the public” stemming from this loan modification scam. The State Bar brought disciplinary charges against him the following month, but Diener denied the allegations in a response filed Dec. 15.
The attorney general has also filed for civil penalties against the three defendants related to the alleged scam, seeking restitution and an injunction from further illegal practices.
The case is the result of a collaborative effort between the Orange County District Attorney’s Office, the State Bar of California, the Department of Real Estate, and the California Attorney General’s Office.
Copyright 2010, Metropolitan News Company