Feds indict three Bakersfield residents on mortgage fraud charges
| Wednesday, Jun 16 2010 07:17 PM
Last Updated Wednesday, Jun 16 2010 07:17 PM
A federal grand jury has added three names to the list of Bakersfield people accused of conspiring to commit mortgage fraud during the housing boom.
An indictment unsealed Monday accuses Eric Ray Hernandez, 34; his wife, Monica Marie Hernandez, 29; and Evelyn Brigget Sanchez, 27, of conspiracy to commit mail fraud, wire fraud, bank fraud and 15 counts of mail fraud. The Hernandezes were also charged with money laundering.
The scheme cost lenders more than $2.5 million, according to the U.S. Department of Justice, which announced the charges Wednesday.
At the heart of the June 10 indictment are allegations that the three individuals provided bogus information -- false pay stubs, letters from tax accountants and bank statements -- to support home loan and refinance applications. This is the latest of at least four mortgage fraud conspiracy cases to hit Bakersfield in recent years.
The indictment said more people may be charged.
All three defendants pleaded not guilty in court earlier this week. Eric Hernandez was arrested Monday and remains in custody; Monica Hernandez was arrested Monday as well and released on her own recognizance. Sanchez was arrested Tuesday and released on her own recognizance.
'Just allegations'
Monica Hernandez, speaking by phone Wednesday, declined to address the charges. But she said the situation described in the indictments had been blown out of proportion, and that people ought to have consideration for her four young children.
"They're just allegations. That's it. That's all it is," she said.
"We are going to cooperate, do what we need to do to get this fixed."
Sanchez could not be reached for comment, nor could attorneys representing the defendants.
If convicted, the defendants face a maximum penalty of 30 years in prison, five years of probation and a $1 million fine.
Eric Hernandez worked as a loan officer at Network Source Funding, a Bakersfield mortgage brokerage, roughly between October 2005 and August 2006, and then at New Millennium Lending from about August 2006 to May 2007, the indictment states. Sanchez, it says, worked as a loan processor at Network Source from about May 2005 to August 2006, then worked at New Millenium from about August 2006 to May 2007. It says Monica Hernandez, also known as Monica Marie Duarte, processed loan transactions with her husband and Sanchez. All three defendants lived in Bakersfield.
Network Source Funding and New Millenium both appear to have closed.
The indictment lists seven Bakersfield addresses it says were examples of properties where false information was used on loan applications: 3803 Mount Celeste Court, 14441 Kathleen Ave., 4401 Vern St., 3715 Kathy Suzanne Way, 5107 Fountain Grass Ave., 643 Sunset Meadow Lane and 4303 Walker Lake Drive. A spokeswoman for the U.S. Attorney's Office said most if not all of the homes in the case were in foreclosure.
There is no indication in the indictment as to whether any of the defendants were personally involved in buying or selling property.
Lenders listed in the indictment as having received false information are SunTrust Mortgage Inc., Long Beach Mortgage Co., WMC Mortgage Corp. and Washington Mutual Bank.
A news release issued Wednesday by the Department of Justice said the case grew from an "extensive investigation" by the Internal Revenue Service's Criminal Investigation division, the Federal Bureau of Investigation and the San Joaquin Valley Mortgage Fraud Task Force.
