Probe Widens in Mortgage Swindle; New Charges Filed

The investigation of a Hawthorne man accused of swindling homeowners in need of loans has expanded as officials filed new charges naming 22 victims and said they expect to find scores more across Southern California.

The Los Angeles city attorney has brought a total of 66 misdemeanor charges against Richard Griffin, 56, who is accused of running a swindle in which homeowners facing foreclosure on their mortgages were promised refinancing to save their homes. Authorities say he failed to follow through on his promises, leaving homeowners in a bind when mortgage payments came due.

Officials say Griffin filed bankruptcy papers on behalf of his clients but took no steps to refinance their homes. When homeowners tried to contact Griffin, they could not find him, officials said.

“There’s a lot of people who really are a lot worse off as a result of dealing with him,” Deputy City Atty. Ellen Pais said.

Officials said they have found victims throughout Los Angeles County and are looking into possible violations in Orange, Riverside, San Bernardino and Ventura counties.

Free on Bail

The city attorney on Thursday filed 59 criminal charges against Griffin, who had been charged in June with seven misdemeanor counts. Charged with grand theft, making false and misleading statements, taking money before performing foreclosure services and failing to provide a client, Griffin, who is free on bail, is due to be arraigned in Los Angeles Municipal Court Monday.

Pais said Griffin may have swindled “many hundreds” of people out of several hundred thousand dollars. Investigators have no idea where the money is now, she said.

She said at least two people lost their homes as a result of the alleged scam.

Pais said Griffin would send a flyer to homeowners whose mortgages were being foreclosed describing his services as a consultant.

“The services listed included filing bankruptcies, buying the property or refinancing the property,” she said.

The victims, many of whom were “looking for just about any way to save their home,” were attracted by the low interest rates Griffin offered, Pais said.

First Step

As a first step to forestall his new clients’ foreclosures, Griffin usually asked for $590 or $690 to file bankruptcy for them, Pais said. Filing bankruptcy is a common procedure used to slow foreclosures.

In the alleged scam, bankruptcy proceedings were initiated but never completed.

“He got victims to sign papers and he would fill them out, usually incorrectly,” Pais said.

Griffin told homeowners that he or his representatives would attend bankruptcy hearings for them but never did, Pais said.

If no one appeared to represent the homeowners at the hearings, bankruptcy was dismissed and, under federal law, the homeowners could not reapply for another six months.

Pais said none of the four firms Griffin operated-- Moneylenders Network, Home Loan Network, First National Network and Neighborhood Foreclosure Network--actually existed.

“This man became rich from poor suckers like us,” said Delores Gates of Paramount.

When her house in Bellflower came up for foreclosure in October, she answered a mailing from Griffin and some associates because “they offered to refinance my home for me and put me at a lower house payment than the one I had.”

She said she spent a total of $740 before learning that the offer was a scam.

At that point, she said, she negotiated with her lender for more time to pay back her mortgage and eventually sold her home.