Hells Angels accused of mortgage fraud

Source: San Francisco Chronicle


SAN FRANCISCO -- A Bay Area mortgage broker has been charged with conspiring to arrange more than $10 million in fraudulent home loans for clients who included two leaders of the Hells Angels, federal prosecutors said Tuesday.

A newly unsealed federal grand jury indictment accuses the motorcycle club leaders, the mortgage broker and five other defendants of taking part in a scheme to defraud banks by falsifying loan applications for real estate in San Francisco and several North Bay communities in 2006 and 2007.

The applications misrepresented the borrowers' incomes, bank balances and employment histories and falsely stated that they would live at the properties, some of which were later used for marijuana growing, the indictment said.

Seven defendants have pleaded not guilty. The eighth, Jerry Mays, 63, of San Pablo, an accountant and tax preparer, has not been apprehended, prosecutors said.

Among those charged was Jacob Moynihan, 30, of San Francisco, who owned a company called Xanadu Global Investments and also worked at several San Francisco mortgage brokerage firms, prosecutors said.

The indictment said Moynihan and his clients submitted fraudulent applications for loans, some for more than $1 million, to buy property in Santa Rosa, Petaluma and Healdsburg. The clients included two local Hells Angels leaders, Raymond Foakes, 48, of Rohnert Park and Josh Leo Johnson, 35, of Santa Rosa, prosecutors said.

Foakes is a former president of the Sonoma County Hells Angels and recently served a prison sentence for a 2002 brawl with a rival motorcycle gang at a casino in southern Nevada in which three people died. Prosecutors are seeking to keep him in jail until a trial on the mortgage charges.

His lawyer, Anthony Brass, said Foakes actually made mortgage payments on the Petaluma home that is the subject of the charges against him. Brass said he didn't know whether Foakes' loan application was accurate, but said overstating one's income when seeking a home loan "was common practice at that time."

The other defendants are Moynihan's father, Gerald Moynihan, 51, of Santa Rosa; Desiree Maclean, 25, of Rohnert Park; John Greco, 38, of Rohnert Park; and Justin Batemon, 34, of Hayward.

URL to original article: http://www.housingwire.com/2011/09/28/hells-angels-accused-of-mortgage-fraud

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