5 Investigates mortgage fraud claim
A 5 Investigates hidden camera investigation has been examining a Valley company that promises to devote billions of dollars to reduce mortgage payments for desperate homeowners.
It was the combination of a slick website and desperation that Cheryl Van Berkum said led her to a company called the Guardian Group.
"Oh, I thought it was great," she said.
"It" was a plan by the Guardian Group that would allow Van Berkum and her family to keep their home that was in danger of foreclosure.
Van Berkum said the plan the group offered was not a loan modification, but something new.
"They told me they would purchase the note from Wells Fargo and set it up so that I would be able to make the payments," Van Berkum said.
5 Investigates discovered that the plan was laid out in a power point presentation the company sent to Van Berkum and other desperate homeowners.
The company also e-mailed documents from a recent success story as proof that the program works.
"I did go on the Internet and checked them out and everything looked fine," Cheryl Van Berkum
However, two months later, Van Berkum said she lost her home to foreclosure, and is out the $1,595 she said she paid Guardian Group.
"Stay away from the Guardian Group," Van Berkum said.
When asked if she thought the company was a sham she said, "Yes it is."
5 Investigates sent one of its producers into the company's Scottsdale office with a hidden camera.
The video showed that most of the people in the company's waiting room were Spanish speakers; several trying to get their money back.
"Hi. I'm Gilbert," said the producer in the video.
When a representative of the company spoke to the producer on the video, it was a familiar story. "We negotiate with the lender," the representative said. "We go and buy, just in simple terms, we go and buy the note -- which is your loan."
The Guardian Group representative added, "Actually, they settle for 5-cents on the dollar, 10-cents on the dollar."
On the video, the representative said Guardian Group could buy the house and sell it back to the 5 Investigates producer below market value.
Leana Macial said that same sales pitch led her to hand over $1,595 to Guardian Group as well.
After her husband's work hours were cut, she said her family was struggling to hang onto their home.
5 Investigates asked Macial if she was told by the company that it would buy her house in a short sale. She said yes.
However, she said she also lost her home after Guardian failed to make the purchase.
5 Investigates took a closer look at the company. Until recently, its website claimed it had access to $5 billion in funding meant to "help homeowners across America in their time of need."
But when 5 Investigates looked up the company's corporate filings, it discovered that the articles of incorporation -- the primary rules governing the management of the corporation -- were scribbled out in barely readable handwriting.
One former Guardian Group employee told 5 Investigates the company signed up more than 2,000 clients at $1,595 each, and that he didn't know of one success story.
Maricopa County records indicated that Guardian has bought and sold just three homes.
In March, U.S. Attorney General Eric Holder came to Phoenix to talk about mortgage fraud.
During a news conference, 5 Investigates told him about the complaints against Guardian Group.
"I think the problem that you've identified is very real. And what I hope people hear is that to the extent they find themselves the victims of fraud, we want to hear from them," said Holder.
About a dozen unsatisfied Guardian Group customers have contacted CBS 5 News.
Dozens more have written about their experiences on Internet message boards.
They all said they filed complaints with the state Attorney General's Office, but Guardian Group is still in business.
5 Investigates called the company directly, and left business cards at the owners' homes, but did not receive a return phone call.
Recently, the 5 Investigates team walked into the company's Scottsdale office with cameras rolling.
"Excuse me. I work for CBS 5 News. I'd like to talk to someone about your business here," said the reporter.
The receptionist at the company office ran out the back door when the news crew walked in.
5 Investigates waited until a representative finally came out to speak on camera.
"I'll make sure this gets to one of the principles and they'll get back with you," said the representative.
About 10 minutes later, a man named Bryan Prehoda called the reporter. He described the company as a public service, and said it would be a tragedy if CBS 5 News reported a negative story.
However, he refused a request to talk in person on camera.
Since 5 Investigates began looking into Guardian Group, more clients have come forward to say they feel like they were victimized twice: once when they handed over money to Guardian Group and again when they lost their homes.
"I'd like them shut down," Van Berkum said. "I want my money back, but I'd like them shut down so they don't do it to anybody else."
Prehoda insisted it is a legitimate business.
Prehoda said although the company has not been very successful at buying its clients' homes, they have helped people stay in foreclosed homes rent-free for months.
Note: CBS 5 News has been contacted by a company concerned that some of their lawn signs were shown in our investigative report on July 15th. Some of the "foreclosure/auction" signs in our report belong to Real Estate Disposition, LLC and its affiliates "REDC." REDC is an auctioneer and licensed broker, and has no connection to the mortgage fraud and appraisal fraud detailed in the CBS 5 report. In fact, the foreclosure signs that were shown across the valley did not belong to any of the companies named in our report on mortgage fraud and appraisal fraud.
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