The Colorado state grand jury has indicted nine people who allegedly targeted distressed homeowners as part of a fraudulent short-sale scheme.
Prosecutors allege that the defendants ultimately defrauded the banks and lenders that held the mortgages for the distressed homeowners.
Eight of the nine defendants are being charged under the Colorado Organized Crime Control Act for a pattern of manipulating homeowners who were facing foreclosure, creating and processing forged documents relating to properties, and ultimately using the forged documents and other actions to defraud the lenders and subsequent buyers.
“It is unconscionable that this group would target financially distressed and vulnerable homeowners by fraudulently taking control of and selling their properties, with the ultimate goal of defrauding the homeowners’ financial institutions and the subsequent homeowners,” alleged Colorado Attorney General John Suthers.
“This group took advantage of multiple homeowners, using deception and forged documents, to create illegal profits on the sale of various properties,” said Suthers in a statement.
The indictment said the group’s alleged scheme was used in the short sale of “at least eight” properties since 2008.
According to prosecutors, the basic premise of the scheme focused on identifying distressed homeowners who were in foreclosure status.
The tactics allegedly included manipulating the homeowners to sign over ownership and control to the enterprise; filing forged paperwork with the lenders, misrepresenting that the original homeowners still owned the house; and using “straw buyers” who were fraudulently represented to the banks as being arm’s-length purchasers.
Indicted were Wendy Thomas, 46, of Chicago, previously of Thornton; Cristina Nicole Smith, 42, of Thornton; Kurt Smith, 58, of Thornton; Sheila Gaston, 59, of Elizabeth; Sheila Giberti, 46, of Broomfield; Duane Thomas, 44, of Thornton; Christopher Consol, 43, of Englewood; Janice Gardner, 48, of Brighton; and Joseph Slowey, 47, of Denver.
Howard Pankratz: 303-954-1939, hpankratz@denverpost.com or howardpankratz
