Chicago man sentenced to 6 years for fraud - KFVS12 News & Weather Cape Girardeau, Carbondale, Poplar Bluff

Chicago man sentenced to 6 years for fraud

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Attorney General Lisa Madigan announced a six-year prison sentence for a Chicago man who stole more than $350,000 by preying on desperate homeowners seeking to avoid foreclosure.

Warren Jackson, 44, of Chicago, pleaded guilty to criminal mortgage rescue fraud before Cook County Circuit Court Judge Mary M. Brosnahan on Thursday, April 25 and was sentenced to six years in the Illinois Department of Corrections.

“The defendant preyed on homeowners who were desperate for a lifeline but instead found themselves targets of a criminal,” Madigan said. “Homeowners who were victim to these schemes were left at an even greater risk of losing their homes.”

Jackson orchestrated two mortgage loan modification schemes involving Chicago homeowners. The first scam targeted homeowners at risk of foreclosure, promising to save their homes by negotiating lower mortgage payments with their banks. Jackson collected illegal upfront fees from the homeowners but never followed through on his claims to help reduce homeowners’ mortgage payments, placing the scheme’s victims at even greater risk of foreclosure.

In the second scheme, called a “sale-leaseback” that Jackson alleged would save a homeowner’s home, he used straw buyers to purchase homes from distressed homeowners, sometimes falsely promising them that they could pay rent for a year and then could potentially buy back the property. Jackson also tricked homeowners into unknowingly selling their homes to straw buyers by leading them to believe that they were signing paperwork for a new loan to help them avoid foreclosure. Jackson used the sale-leaseback scheme to transfer title from homeowners to straw buyers for the purpose of stripping the remaining equity from the home. Individual homeowners lost from $70,000 to $150,000 of equity in their homes as a result of the schemes.

Madigan has previously sued Jackson. In December 2010, Madigan filed suit for their illegal operation and solicitation for a Chicago charity, We Stop the Killings, and obtained an injunction in July 2011 that permanently barred Jackson from soliciting, receiving or holding assets for any charitable purpose in the state of Illinois or on behalf of any Illinois-based charity. Prior to that case, Madigan sued and obtained a judgment against Jackson for his involvement in companies W2X Inc., PTU1 Inc., Y2X LLC, and Goldberg Bail-Out Inc. for similar mortgage-related fraud.

Attorney General Madigan has aggressively targeted mortgage-rescue scams illegally charging homeowners upfront fees for rescue services. Madigan has previously filed 50 civil lawsuits against illegal operators and issued over 700 cease-and-desist letters.

'Madigan urged homeowners who are struggling to stay in their homes to contact her Homeowner Helpline, (866) 544-7151, for guidance on avoiding foreclosure and to seek help from a HUD-certified housing counselor to work out a solution with their lenders.

Assistant Attorneys General Paul Bervid and Anshuman Vaidya handled the case for Madigan’s Financial Crimes Bureau. The case was investigated by Associate Director James S. Dorger of the Attorney General’s Public Integrity Bureau, with assistance from the Federal Bureau of Investigation.

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