Mortgage elimination is a type of mortgage fraud in the United States. In this scam, the promoter first convinces a mortgage holder that the debt that has been contracted is invalid or legally unenforceable, usually due to a combination of alleged technicalities in the note, deed of trust, or other loan documentation signed; the promoters often link their rationale for debt elimination to illegality of certain lending practices, the Federal Reserve, and the monetary system of the United States in general. Through a series of illegal maneuvers involving the creation of a trust, a demand letter, and a false re-conveyance of title, the promoter and the original mortgage holder concert to create the appearance of a title free of liens and encumbrances so that another loan may be taken out on the property.[1]
The United States FBI has put out specific warnings regarding this kind of scam.[2]
As of 2006, the Dorean Group was a high-profile promoter of this type of scam.[3] A number of people, described as the "principals with the Dorean Group", were convicted on multiple counts of fraud in California in 2007.[4][5]
See also
edit- Rodolphus Allen Family Private Trust, a "trust" which purported to prevent repossession of at-risk properties in Ireland
References
edit- ^ "'Mortgage elimination' scam leaves many without a roof over their heads". southcoasttoday.com. March 25, 2007.
- ^ "Federal Bureau of Investigation - Press Room - Headline Archives". fbi.gov. Archived from the original on 2005-12-16.
- ^ "Dirty Deeds". eastbayexpress.com. 5 April 2006.
- ^ "Mortgage Fraud Blog - November 19, 2007 - Dorean Group Principals Found Guilty". 2007. Archived from the original on 2010-05-23. Retrieved 2010-05-24.
- ^ "United States v. Heineman". United States District Court, N.D. California. August 19, 2008. Retrieved January 10, 2025 – via casetext.com.
Dale Scott Heineman and Kurt F. Johnson were founders and principals of the Dorean Group. They [..] were charged with and convicted of conspiracy and multiple counts of mail fraud, stemming from a fraudulent debt-elimination scheme
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