Charges Filed for Foreclosure Rescue Fraud

Allison Tussey —  March 31, 2011 — Leave a comment

Joella Jean Britton, 37, Eagle, Michigan, and Nicole Lee Otis, 35, Lansing, Michigan, have been charged for their roles in a foreclosure-rescue fraud scheme that took place in Lansing.  The defendants are each charged with one count of False Pretenses, a ten-year felony, for providing fraudulent information to a mortgage lender.

Investigation revealed that Britton and Otis allegedly claimed they would help a Lansing couple facing the threat of foreclosure by purchasing their home and selling it back to them on land contract. The victim homeowners had been living in their home for 14 years until they experienced financial difficulties and the house went into default (pre-foreclosure) in early 2005. They were contacted by U.S. mail with an offer to help them avoid foreclosure and they were referred to Joella Britton.

Britton allegedly advised the homeowners that she had an investor, Nicole Otis, who would purchase their home and sell it back to them on land contract, claiming that within a year their credit would improve enough to accomplish that. Britton advised the homeowners she would assist them with improving their credit, and Otis would sell the property back to them.

The complaint alleges Britton drew up the land contract documents and set the closing for the sale of their property on May 19, 2005. The statement showed that Otis was putting $20,000 down on the deal. In reality, as is typical in foreclosure-rescue scams, the victim homeowners were instructed to sign over part of their proceeds from the sale to fund Otis‘ $20,000 down-payment.  Otis did not really make the down payment with her own funds, which is a fraudulent claim to the lender and violates state law.

Although the homeowners made payments under the land contract, Otis had stopped making payments on the mortgage, and the homeowners were still evicted from their house after Otis allowed it to fall to foreclosure. The victims later filed a complaint with Lansing Township police on May 1, 2007.

Britton and Otis are each charged with one count of False Pretenses, a ten-year felony. Otis was arrested on Friday, March 25, 2011, and was released on the condition that she return for arraignment. Britton is expected to turn herself in this week. Both defendants will be arraigned in Lansing’s 54-A District Court.

Attorney General Bill Schuette announced the charges.

“Foreclosure rescue scam artists who exploit Michigan homeowners struggling to keep their homes will be brought to justice,” said Schuette.

“I would like to thank the Lansing Township Police Department for their hard work and assistance in uncovering this fraud,” said Schuette who encourages homeowners facing foreclosure to review information on how to avoid foreclosure on his website at www.michigan.gov/avoidforeclosure. Consumer complaints regarding
foreclosure may be filed online with the Attorney General’s Office at www.michigan.gov/ag by clicking “File a Complaint.” Concerned homeowners can also call the Michigan State Housing and Development Authority foreclosure hotline, 1-866-946-7432, to be connected with a free foreclosure prevention counselor in their area.

A criminal charge is merely an accusation and the defendant is presumed innocent until proven guilty.

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Allison Tussey

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