Leader of Mortgage Relief Scam Gets 24 Year Prison Sentence
By Consumers Union on Friday, March 6th, 2015
Over the years, Consumers Union has spoken to countless homeowners who were duped by fraud artists who promised to rescue them from losing their homes to foreclosure. Their stories are heartbreaking of how the scam artists preyed upon their desperate situation, took their money, and left them worse off.
That’s why it is very good to hear today that Alan Tikal, one of those responsible for defrauding more than 1,000 homeowners in California, was sentenced to 24 years in prison, according to the federal agency SIGTARP. Sadly, this conviction does not return what was lost by the homeowners he defrauded, but if losing one’s freedom for 24 years is any measure of compensation to his victims, this is an important step in obtaining justice.
According to SIGTARP, between January 2010 and August 2013, Tikal operated a business under the name KATN, which targeted vulnerable and non-English speaking homeowners looking for mortgage assistance in the wake of the financial meltdown. Tikal and his associates convinced more than 1,000 homeowners to pay more than $5,800,000 in fees and monthly payments for his false promises to help them. Instead of helping his victims, he pocketed the fees and used them for chartered airline travel, a $5,000 suit, new cars and other extravagant living expenses.
As we welcome today’s news, we are reminded to keep it in context. That is, if not for the mortgage meltdown precipitated by rampant predatory mortgage lending, there would have been no spawning ground for scam artists like Alan Tikal. That is one reason why it is as important–if not more important–to uproot the rotten tree as it is to prune its branches. We documented how predatory mortgage lending devastated the lives of everyday people in our Faces of Foreclosure videos we produced in 2008. These videos and today’s news are a sobering reminder of a dark history which should never be repeated. They underscore the many reasons why the financial marketplace reforms we fought for, and that have been enacted since the mortgage collapse, must remain intact.