White Collar Crime News

1 of 3 wanted suspects in foreclosure scam arrested January 10, 2009

Jessica Refuerzo has been arrested while Julita Whittingham and Edgardo Orcino are still being sought for allegedly defrauding homeowners out of more than $100,000.  Authorities allege that the three along with two others that have already been arrested, told at least 17 people that “land patents” would protect them from impending foreclosure. 

According to San Diego’s DA, the group claimed that the patents would make the owners a sovereign nation and protect them because the banks would not own the land or be able to come into their property.  The story is here.   In other words, the bank would own the house but not the land under them.  Thus, without the land, the house is worthless.

I need more information about the players here before I can fully analyze the case and possible defenses.  While you can look at this can think that this is an obvious scam, it wasn’t obvious to the people that fell for it.  Likewise, many people are involved in questionable businesses without really understanding what they are selling and if it is true and/or legal.  One would assume that the head of the operation would know what was going on and that presents a more complex problem.  However, my defense for the lesser people involved would be that they thought that what they were doing was legit. 

First, they didn’t seem to hide in the shadows; this was an up front business.  I would beat that drum all day in front of the jury.  After all, if the client is engaging in criminal activity, why would you be so up front about it?  How could you ever hope to get away with it?  Instead, they are acting like every other legal business does.  Second, this wasn’t a novel idea.  There are plenty of other websites that proclaim that this is possible and the people behind them are not arrested.

Here’s a good example:  http://landpatentpapers.com/  While the website itself contains a lot of discussion about the history of land use without an explicit mention that you can avoid foreclosure, the title of the page (look at the top of your browser) says:  “Learn to be free of bank foreclosures”.  At the bottom of the page, it states that:  “For the procedure to acquire your name into a Land Patent you must take your name out of Color of Title (fictional characteristic usage of language) and bring it into the proper perspective of the Land Patent ( the truth of the language) such a procedure can be acquired with complete forms and instructions for a gift of $19.95 may be sent to  R. J. Elsarelli at P.O. Box 194 Durand Michigan 48429 with notification to LandPatentService@TheNorthernNews.net allow seven to ten days by mail or use the credit card system.” 

 The site seems to be registered to a Richard J Elsarelli of Durand, MI.  This information was found here.   Is Richard’s site slick enough to stay within the bounds of the law or is the 19.95 price low enough for the police not to care?  More importantly, what does this “procedure” indicate that you can actually accomplish?