‘Honey, you’ve been scammed’: Va. woman loses her home

68-year-old among thou­sands who were hit by mort­gage scheme

The Washington Post Sunday - - METRO - BY RACHEL WEINER

Bar­bara Barkley is 4 foot 10. So she de­signed her home in Ch­e­sa­peake, Va., just for her­self, with all the coun­ters and han­dles low­ered.

Peo­ple told her the changes would make the house harder to sell, but she didn’t care.

“I planned to live there un­til I died,” the 68-year-old said.

In­stead, she is rent­ing a place from a rel­a­tive in North Carolina. lost her house and her sav­ings to a group of Cal­i­for­nia scam artists who stole $11 mil­lion from thou­sands of strug­gling home­own­ers look­ing for help with their mort­gages.

The ring­leader, Sammy Araya, 42, was sen­tenced in fed­eral court in Alexan­dria this month to 20 years in prison. Eleven oth­ers got sen­tences rang­ing from five to 18 years.

While the court case is all but over, Barkley and other vic­tims con­tinue to deal with the fall­out of a crime that de­stroyed them fi­nan­cially and of­ten emo­tion­ally.

“I lit­er­ally lost every­thing beShe cause of these peo­ple, and it’s break­ing my heart,” said Barkley, who had worked in ad­ver­tis­ing. “I paid for it all my­self, didn’t have a man to pay for it for me, and then some stranger gets to de­stroy it.”

The scam be­gan in 2011 when Araya’s group started send­ing out mail­ers and put up In­ter­net ads promis­ing mort­gage mod­i­fi­ca­tions un­der an Obama ad­min­is­tra­tion pro­gram meant to stem fall­out from the hous­ing cri­sis.

The pro­gram was real, but the of­fers were not. Home­own­ers were directed to send a cash “re­in­state­ment” fee and then monthly “trial pay­ments” for their new monthly mort­gage. The money, they were told, would go to the lender.

In­stead, the con­spir­a­tors pock­eted the funds and ig­nored in­creas­ingly des­per­ate calls from their cus­tomers. Barkley found

out the truth when a man on a mo­tor­cy­cle came to paste a no­tice from her mort­gage lender on the door warn­ing of fore­clo­sure. She called the com­pany to tell it she had been send­ing her checks as re­quired.

“I sent them the proof, and they said, ‘That’s not us,’ ” she re­called. “I called the [Fed­eral Trade Com­mis­sion] and they said, ‘Honey, you’ve been scammed.’ ”

Govern­ment rep­re­sen­ta­tives told her there was noth­ing they could do, and her lender wouldn’t work with her. She lost her cus­tom-fit home of 30 years.

“He was tar­get­ing peo­ple who were first off in­cred­i­bly vul­ner­a­ble, and sec­ond, in­cred­i­bly trust­ing,” As­sis­tant U.S. At­tor­ney Ryan Faulconer said at sen­tenc­ing. The num­ber of vic­tims, he said, “wouldn’t fit in this court­room or prob­a­bly all of the court­rooms in this build­ing . . . . It’s stag­ger­ing.”

The scam en­snared peo­ple across the coun­try, al­though one co-con­spir­a­tor said in an in­ter­view with in­ves­ti­ga­tors that Araya avoided Cal­i­for­nia out of fear of then-At­tor­ney Gen­eral Ka­mala D. Har­ris, who is now a U.S. sen­a­tor. At least one cou­ple got di­vorced from the stress of los­ing their home. One vic­tim briefly was made home­less and had to put her daugh­ter in a pe­di­atric psy­chi­atric unit to deal with the trauma.

Archie Davis got pulled in as he was look­ing to re­duce the pay­ments on a home in Wood­bridge, Va., he had been given by his ex-wife. She had been be­hind on the mort­gage, and the base­ment had flooded. Davis, 64, had in­vested heav­ily in re­pairs. He too sent a “re­in­state­ment fee” to the scam­mers and sev­eral monthly pay­ments. They told him that he should file for bank­ruptcy and that the com­pany would rep­re­sent him in court. He paid to file the pa­pers in Alexan­dria; they never showed.

The house is now gone, along with tools that were trapped in­side when the bank seized it.

“I could’ve used that money,” he said. He and his ex-wife take care of a 28-year-old daugh­ter with brain can­cer.

If he ever gets paid back, Davis pre­dicted, “I’ll prob­a­bly be se­nile. I’ll think I won the lot­tery.”

Araya, mean­while, lived the high life, ac­cord­ing to testimony, fre­quent­ing strip clubs and throw­ing wild par­ties at a leased man­sion in Orange County, Calif. YouTube videos from his at­tempt to launch an on­line real­ity TV show, “MakeItRain TV,” fea­ture Araya show­ing off stacks of cash in the home’s re­frig­er­a­tor, lux­ury cars in the garage and an ex­ten­sive sneaker col­lec­tion in the mas­ter bed­room.

The show’s premise in­volved throw­ing wads of cash into crowds. In one episode, he per­forms a par­ody of singer Re­becca Black’s sin­gle “Fri­day” called “Fly Day.”

Araya pit­ted teams of sellers against one an­other, of­fer­ing Los Angeles Lak­ers tickets and fancy din­ners for the most suc­cess­ful con artists. He de­manded they all use aliases, and he also de­ployed sev­eral names and fake ac­cents.

When fed­eral in­ves­ti­ga­tors started clos­ing in, he re­peat­edly changed of­fices and busi­ness names, de­stroy­ing com­put­ers along the way. One co-con­spir­a­tor tes­ti­fied that Araya once used a fed­eral com­plaint to roll a joint.

The scheme wound down in sum­mer 2014 af­ter search war­rants were ex­e­cuted on con­nected busi­nesses and homes. Araya al­legedly went on to start an­other scam, fleec­ing sev­eral Texas busi­ness ex­ec­u­tives out of hun­dreds of thou­sands of dol­lars with a fake oil in­vest­ment op­por­tu­nity, ac­cord­ing to court fil­ings.

Nine co-con­spir­a­tors pleaded guilty in the mort­gage scam case. Araya and two oth­ers were con­victed at trial, while main­tain­ing they were duped and wrongly blamed by the true per­pe­tra­tors.

Pros­e­cu­tors had wanted Araya in prison for life, warn­ing that even as he faced trial he was work­ing on his next scam. On the day his trial was sup­posed to start in Fe­bru­ary, he set up a Go­FundMe page ask­ing for do­na­tions to start a church. In his new YouTube videos pro­mot­ing the church he ap­peared clean-cut and se­ri­ous, hold­ing his young daugh­ter. The re­vival, he said, would start the day af­ter the trial ended.

The church slo­gan: “Give ’til it hurts.”

“He was tar­get­ing peo­ple who were first off in­cred­i­bly vul­ner­a­ble, and sec­ond, in­cred­i­bly trust­ing . . . . It’s stag­ger­ing.” As­sis­tant U.S. At­tor­ney Ryan Faulconer re­fer­ring at sen­tenc­ing to Sammy Araya, 42, the ring­leader of the con who was sen­tenced this month to 20 years in prison

FAM­ILY PHOTO

Bar­bara Barkley with her grand­son in the cus­tom-built home she lost be­cause of a mort­gage con. Barkley is 4 foot 10. So she had de­signed her home in Ch­e­sa­peake, Va., just for her­self.

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