How three Crisp & Cole foreclosures unfolded
| Monday, Jan 24 2011 07:17 PM
Last Updated Tuesday, Jan 25 2011 10:59 AM
It may be some time before we know how the federal case against David Crisp, Carl Cole and eight others unfolds in court.
But the federal grand jury indictment unsealed last week lists 19 properties bought by Crisp, Cole & Associate staffers or family members. Prosecutors allege the defendants used “a variety of fraud schemes” to skim cash from each transaction through an “elaborate use of straw buyers” to buy, sell, and refinance homes. Property values were sometimes inflated by flipping houses among a web of participants.
Here are histories of three, with figures that give a sense of how much banks ultimately lost on the deals:
March 2006:
Sneha Mohammadi, a top Crisp & Cole staffer who eventually became the company's chief financial officer, buys the home for about $1.1 million with 100 percent financing from SunTrust Mortgage Inc.
April 2006:
The following month, Mohammadi sells the house to Leslie Sluga, Crisp's mother-in-law, for $1.7 million -- a nearly 52 percent increase over the previous month's sale. Sluga also gets 100 percent financing, from Kirkwood Financial Corp.
May 2008:
The house is foreclosed on. More than $1.4 million, counting interest and penalties, is owed on the first loan of about $1.3 million.
July 2008:
The bank resells the house for $950,000, or $750,000 less than Sluga borrowed against it.
The federal indictment alleges: Two counts each of mail fraud and of wire fraud for Crisp, Cole, Mohammadi and former operations manager Julie Farmer involving loans against the property.
Also: The state Department of Real Estate, in its September 2007 accusation against Crisp, Cole, Mohammadi and others, alleged Crisp agreed to pay Mohammadi to pose as the buyer and planned to get profits from the subsequent sale to his mother-in-law. All three lost their real estate licenses as a result of the DRE scrutiny.
May 2005:
With Crisp & Cole Real Estate as the listing agent, the house is sold to a woman for $355,000 with 100 percent financing from Long Beach Mortgage Co.
December 2005:
The woman, whose relationship to Crisp & Cole was unclear as of Monday, gifts the property to Crisp, Cole & Associates -- in other words, gives it to the company for free.
The same day, the company sells the home to Carl Cole for $455,000. The deed granting the property to Cole is signed by Crisp, the company president. Cole gets 100 percent financing from SunTrust.
November 2007:
The home is foreclosed on. The amount owed on the $364,000 first loan has climbed to more than $396,000 with interest and penalties. Second loans -- in this case, $91,000 -- are typically written off as total losses in a foreclosure.
January 2008:
The bank sells the home to a married couple for about $250,000, a 45 percent drop from Cole's purchase price two years before.
The sale price represents a loss for the lender of about $205,000, not counting any interest and penalties on Cole's loans.
The federal indictment alleges: Two counts each of wire fraud for Crisp and Cole involving the loans taken out by Cole.
April 2004:
Mohammadi and her husband buy the house for $615,000.
September 2006:
The Mohammadis sell the property to David Crisp's wife, Jennifer, for nearly $1.3 million -- more than double what it last sold for. Jennifer Crisp gets 100 percent financing from SunTrust.
February 2008:
The house is foreclosed on. The primary loan of $1 million has not been paid down at all when interest and penalties are counted.
June 2008:
The lender sells the home to a couple for about $510,000 -- or $790,000 less than Jennifer Crisp borrowed against it.
The federal indictment alleges: Two counts each of mail fraud and of wire fraud for David Crisp, Jennifer Crisp and Cole.
Also: The state Department of Real Estate, in its 2007 accusation, said Jennifer Crisp had falsely claimed to be working as chief operating officer at her father's CPA business. Her father, Kevin Sluga, has since pleaded guilty to four counts of wire fraud and admitted in the plea deal that he created CPA letters containing false employment and income information to help straw buyers get loans.
-- Sources: Kern County Hall of Records, California Department of Real Estate, federal indictment, Californian research
http://www.bakersfield.com/news/local/x1260937300/How-three-Crisp-Cole-foreclosures-unfolded
