Victims say Las Vegas mortgage broker facing charges in two states preyed on Hispanics

By Tovin Lapan

Friday, March 23, 2012 | 2 a.m.

In 2005, Roxana Sosa and her husband bought a four-bedroom house in Whitney Ranch. They envisioned it as the home where they would host family get-togethers, retire and grow old.

Two years later, Sosa, who emigrated from Guatemala when she was 18, passed her citizenship test, joining her husband, who had obtained citizenship years earlier.

Citizenship and a home — “It was, you know, the American dream,” said Sosa, 44. “I felt like we had accomplished something in this country.”

That feeling was short-lived. Their mortgage was set to go from $1,700 to $2,100 per month in 2008. Soon after, Sosa lost her job at a cleaning company, and the family started to struggle with mortgage payments.

In July 2009, they went to see Gustave “Gustavo” Anaya, who offered loan modification services. For a time, Anaya advertised heavily on Spanish-language radio and television, at one point hosting a 30-minute infomercial on loan modifications.

Sosa said she met Anaya and he assured her that his company did loan modifications all the time and it would be a simple process. Anaya said he could lower Sosa’s monthly payments by as much as $700.

“He told us to stop paying our mortgage so we could prove we couldn’t make the payments. So, we did what he said,” Sosa said.

Over the next four months, Sosa and her husband paid Anaya $2,980. They never saw Anaya again and, Sosa said, his company never did anything on their behalf to secure a loan modification.

What the Sosas did not know was that Anaya had his own financial troubles — and arguably should not have qualified to work in the mortgage industry. State regulations stipulate that a person seeking a mortgage agent or brokerage license must exhibit “financial responsibility, character and general fitness.” A few months before the Sosas went to Anaya’s office, Nissan Motor Co. filed a complaint in a Nevada court to force Anaya, a onetime Nissan dealer, to make payments on a $2.3 million California judgment from 1997.

Despite the regulations governing licensing of mortgage brokerages, Anaya and his wife, who is also named in the complaints, received numerous renewals, and homeowners in mortgage distress say Anaya took advantage of the Hispanic community, their trust in someone of the same ethnicity and their weaknesses with the English language.

In November, the Arizona attorney general filed a complaint alleging that Gustave and Olivia Anaya were defrauding clients through their mortgage broker service. In February, the Nevada attorney general filed a criminal complaint against Gustave Anaya, as well. With the court proceedings just beginning, Olivia Anaya is still licensed as a mortgage agent and Gustave Anaya’s business is still a licensed mortgage broker in Nevada.

Anaya, a 66-year-old former car salesman with thinning white and gray hair and silver, wire-rimmed glasses, was arrested March 6 in Glendale, Ariz., on a Nevada warrant charging mortgage lending fraud, according to the Nevada Attorney General’s Office. He was released on $53,000 bail.

After a court appearance Wednesday, Anaya and his lawyer, Dustin Marcello of Fumo Law, declined to comment to a reporter.

The allegations

Interviews with four previous clients of Anaya’s and a review of the cases detailed in the two court filings reveal a pattern in the allegations.

Anaya, the plaintiffs say, charges up-front fees for loan modification services, a violation of federal law as of January 2011, and leaves his clients feeling little or nothing has been done on their behalf.

Others, echoing Sosa, said once they paid their final installment to Anaya, it became difficult to reach anyone at his offices. Meanwhile, on Anaya’s advice, the clients stopped paying their mortgages and were desperate for some sign of progress with their mortgage holders.

Anaya has at least two registered businesses in Nevada: Mortgage Capital USA and Executive Capitals, both of which operate out of suites in an office building at Pecos and Flamingo roads.

Consumer advocates and officials say mortgage-related fraud is widespread, and Anaya is not the only one accused of such scams. The Nevada Division of Mortgage Lending received 346 complaints in 2011 covering mortgage fraud, loan modification fraud, unlicensed activity, advertising violations and other alleged violations. Of those complaints, 169 were related to loan modification fraud and unlicensed providers of loan modification services. The division took action against 31 entities in 2011 as a result of its investigations.

One former client of Anaya’s, Carlos Garcia, claims he was taken by another fraudulent mortgage agent for $4,000 before he went to Anaya, whom Garcia paid $1,000.

Anaya “promised he could lower our mortgage by $400 or $500 (a month),” Garcia said. “In the end he said he could lower our payment $12 per month. We couldn’t believe it. There are a lot of people doing scams like this, and I got hit by two of them. There must be many, many more victims out there.”

In 2010 and 2011, seven small-claims civil complaints were filed against Anaya. In five of those cases, Anaya was found to have met his contractual obligations and nothing was awarded to the plaintiffs, court documents show. One case is pending, and in another Anaya was ordered to return $1,700 for services that were not delivered.

Maria Herrera, who is named as a victim in the Nevada criminal complaint against Anaya, said she went to Anaya after she hurt her back in a fall, had to cut back on her day care business and was having trouble making her mortgage payments. She heard Anaya’s advertisement on the popular Spanish-language radio program hosted by Eddie “Piolin” Sotelo.

Herrera said an Anaya employee suggested he could lower the monthly payments by $800, and Herrera and her husband paid $2,980 in installments.

“After we paid, I would call and they would say the person working on my case wasn’t there or had left the business,” Herrera, 54, said. “Other times they said they were working on our case and it would all be resolved soon.”

Finally, a mediation session was set up with the bank because the Herreras were not paying their mortgage. Herrera said Anaya’s office promised to provide legal representation, but no one showed for the meeting. When Herrera called, the office denied knowing anything about the meeting.

Helena Garcia, a real estate agent and Las Vegas native who cofounded the advocacy group Latinos in Action, said she had heard complaints about Anaya for at least two years. She estimates Anaya’s victims number in the thousands. She said she fields complaints about mortgage modification fraud weekly.

“This is a huge issue,” Helena Garcia said. “Every day, someone is getting ripped off and losing their house. It’s more than one person a day, and nobody is doing anything about it.”

North Las Vegas resident Lluridia Raygoza tells a similar story about her dealings with Anaya. Raygoza also was charged $2,980, and she did not pay her mortgage or credit card bill for 20 months on the advice of Anaya’s office.

“Because of the type of loan that we had, the bank later told us that we were ineligible for a modification,” Raygoza said, sitting in front of the orange home on an acre of land where she and seven other members of her family live. Anaya “knew we couldn’t modify and he didn’t tell us. He is taking advantage of Hispanics, of people who don’t speak English well enough to understand all of the documents. He gives you one paper translated into Spanish, the refund policy, and then the rest of the contract is in English. We were able to make payments, but we stopped because they told us to. All they did was make things worse.”

Industry regulators and advocates say fraudulent businesses often target people in their own community and social groups. Many people do not know the rules governing mortgage modification services, and they frequently choose services that illegally charge up-front fees because they don’t know the law or because they believe those people will be more effective and faster than free, government-sponsored financial counselors, according to Elisabeth Daniels, the Department of Business and Industry’s spokeswoman and the chairwoman of the state Fight Fraud Task Force. Language barriers make scams easier to execute.

“Those documents are confusing for folks who use English all the time or are native speakers,” Daniels said. “Most people don’t even really review them very carefully. Then you factor in language challenges and people relying on translators. ... It creates a whole new set of challenges for Hispanics and other minority communities.”

Troubled history

Before coming to Las Vegas and starting his mortgage business, Anaya worked as a car salesman and owned dealerships in the Los Angeles area.

In 1990, Anaya purchased a Nissan dealership in Canoga Park, Calif. Anaya’s dealership was struggling by 1993, and he sued Nissan’s finance arm for breach of contract for credit holds placed on his business. A California Superior Court judge threw out Anaya’s claims.

Meanwhile, Nissan countersued, alleging, among other things, that Anaya altered documents and withheld information about his financial standing in reports to the company, according to court documents.

The company said Anaya owed $1.3 million for vehicles he purchased on credit, and, once he sold them, failed to pay back the finance company out of the sale proceeds.

In 1996, Anaya sued Nissan again, but the claims were dismissed. With interest and attorney fees included, Anaya owed Nissan roughly $2.3 million. In 2009, Nissan filed to renew the judgment in Nevada and take action to garnish Anaya’s wages and accounts in Nevada. By that time, interest had brought the total judgment to more than $4 million.

Just a year earlier, City National Bank also filed to have a California judgment against Anaya executed in Nevada. In 1998, a California Superior Court found that Anaya owed the bank $150,000 for an unpaid loan. By the time the bank tracked Anaya down in Nevada and filed court documents to seek repayment of the debt, the bill had escalated to approximately $300,000.

In both cases, Olivia Anaya was also named in the complaints.

Nevada code on the rules and regulations governing who can obtain a mortgage agent license stipulates that a qualified applicant “has demonstrated financial responsibility, character and general fitness so as to command the confidence of the community and warrant a determination that the applicant will operate honestly, fairly and efficiently for the purposes of this chapter.”

Gustave was a licensed mortgage agent in the state for about three years between 2003 and 2007. Olivia Anaya has had a mortgage agent license almost continuously since 2007. The licenses must be renewed annually. Olivia Anaya’s file was reviewed and her license was renewed in January, two months after she had been named in the Arizona attorney general’s complaint. Gustave Anaya is listed as the principal of Mortgage Capital USA, which has an active mortgage broker license.

“In this case, I do believe the government failed,” Sosa said when she learned of the Anayas’ past. “Why did he get a license if he owed so much money and wasn’t paying?”

Mortgage Capital USA has been a licensed mortgage broker since 2007, while Executive Capitals does not appear in the Division of Mortgage Lending’s records as ever holding a license.

Daniels said investigators and industry regulators are in a tough position. While many accusations of fraud are valid, in some cases investigations turn up nothing and the department does not want to punish innocent businesspeople before all facts are gathered. Daniels said she could not speak on any specific person’s license unless action, such as a suspension or termination, had been taken.

“There are a lot of things that happen behind the scenes,” Daniels said. “There’s a lot we can’t discuss (for privacy reasons and to protect an investigation), but that doesn’t mean things aren’t happening. We totally know that people get frustrated when they don’t see things happening, but we can’t say anything until action is taken. If there is another way we could handle it, that would be great. Sometimes the investigators are frustrated, as well. They may believe fraud is occurring, but that can’t be shared or publicized in any way until the investigation is complete.”

Daniels said the Mortgage Lending Division may pursue civil code violations and issue a fine or other penalty. Then, she said, if criminal acts are suspected, they will forward the case to another agency. In April 2011, federal authorities arrested Las Vegas resident Alex Soria on charges of fraud after he was cited by the Mortgage Lending Division for conducting unlicensed loan modifications two years earlier.

Helena Garcia said that was simply not good enough. Licensing should be stricter, she said, and more should be done to prevent businesses from defrauding more victims while they are being investigated.

“I believe the Mortgage Lending Division is liable for a lot of this fraud,” she said. “In my opinion, the state of Nevada needs to be sued for negligence.”

The results

Herrera and Carlos Garcia have managed to stay in their homes and are catching up on payments.

Raygoza and her family are in the process of short selling their home. What they bought in 2008 for $250,000 is now worth approximately $74,000. Having missed 20 months of both mortgage and credit card payments on the advice of Anaya’s employees, the family is not sure when it will scratch back to solvency.

The Sosas failed to pay their mortgage for an entire year. By the time they decided Anaya was not helping them, they were too deep in debt to climb out. Last July, after a mediation session with their bank, they filed for bankruptcy and are now making plans to move out of their home.

“If we had never gone to see Anaya, I believe we would not have had to file for bankruptcy,” Sosa said. “We probably could have kept up with payments with a little help from family and friends, and I eventually found work again after being unemployed for three or four months.”

Helena Garcia said the problem is pervasive and the regulations should be adjusted.

“The laws need to be changed, and this Legislature should give the Mortgage Lending Division more teeth and more enforcement power,” Helena Garcia said.

The home Sosa purchased for more than $300,000 in 2005 is now worth close to $100,000, and she wants nothing more to do with it. Sosa said her primary concern now is making sure no one else is defrauded the way she was.

“I don’t even want a house anymore,” Sosa said. “I wish I could go back to before we ever bought that home and keep our money. I don’t even care about my $3,000. I just want to make sure that Anaya is never allowed to do this to anyone again.”