Illinois regulators have filed a series of complaints against operators of an alleged mortgage rescue scam they said involved seven title insurance companies.
The complaints charge that Mutual Trust Funding Corp., Charles T. White Jr. and seven title companies worked together to con homeowners at risk of foreclosure into signing over their titles and any equity they had built up in their homes.
The Illinois Department of Financial and Professional Regulation last week issued an emergency suspension of White’s loan originator registration, revoked the license of Mutual Trust, and shut down seven title insurance agencies charged with complicity in the mortgage rescue scam. All of those charged in the complaints have the right to an administrative hearing on the charges before the actions are final.
The seven title agencies, owned in part by Mr. Christy Jepson and his wife, Patricia Jepson, do business as All American Title Agency, EJF Title Agency, Palatine Title Agency, Popular Title Agency, Senior Title Agency, Skyline Title Agency LLC and Title Zone. Regulators said White used these companies exclusively for his “rescue” scheme.
Officials charge that White approached homeowners facing imminent foreclosure and offered to find an investor who would borrow money from Mutual Trust to purchase their property before foreclosure. Homeowners were told the new investor would then lease the home back to them while they attempted to regain their financial footing, and were promised that the new investor would repay the delinquent mortgage account and eventually sell the property back to them.
Instead, regulators allege that up to $1.5 million of the loans arranged by White through Mutual Trust were diverted to White’s real estate management company, “Eyes Have Not Seen.” Documents detailing disbursements to previous lenders and current owners, which should have been notarized and filed with appropriate state, federal and financial offices, had been tampered with to show that White was in fact the new owner.
The transactions could not have been completed and the money could not have been siphoned to White’s company without the active participation of the seven title agencies shut down by regulators. White is also charged with failing to disclose his financial interest in Title Zone, one of the seven interconnected title agencies. White’s grandmother is a 30 percent owner of Title Zone, and White is the executor of her estate.