4 Plead Guilty in Frauds

The owner and three employees of a Reseda firm pleaded guilty in federal court Friday to charges of conspiracy and perjury for operating a business that used illegal methods to help tenants evade paying rent, authorities said.

Federal prosecutors said Stanley Simon, 61, and his firm, Tenants Rights Group, had over the past two years filed hundreds of fraudulent bankruptcy claims on behalf of tenants who paid fees of $200 to $2,500.

The bankruptcy filings would delay evictions for months before being dismissed, said Special Assistant U.S. Atty. Steven Katzman. After the bankruptcy dismissals, clients would end up owing landlords the back rent.

“Not only did the clients not get what they paid for, but they ended up being part of a criminal act,” Katzman said. “They didn’t get to live rent-free at all.”

Simon, who pleaded guilty to one count each of perjury and conspiracy to defraud the U.S. government, faces a maximum sentence of 10 years in prison and a $500,000 fine, Katzman said. His firm was considered the largest of the so-called petition mills that have clogged bankruptcy courts in Southern California with legal actions in recent years.

Besides printing flyers advertising their services, Simon and his employees also combed court records to locate tenants facing eviction, Katzman said.

Also pleading guilty to a single count each of conspiracy were Simon employees Tom Spzont and Margarita Ozuna, both of Northridge, and Melody McCord of Simi Valley. Each faces a maximum sentence of five years in prison and a $250,000 fine.

Sentencing is scheduled for April 19 in U.S. District Court in Los Angeles.

The guilty pleas by Simon and his employees are among 10 entered in the past month from a group of 17 people indicted in December for operating bankruptcy-filing scams. Most of the schemes targeted low-income minority and immigrant tenants, authorities said.

Pleading guilty to single counts of bankruptcy fraud were Olivia Barba, 29, of the Bellflower-based P.A. Legal; William Barth, 32, of Tenant Services of Los Angeles; Carlos Estrada, 42, of Tenants United in Downey, and Diana Heineberg of Latin America Legal Services.

Nanie Jean Williams of J.J. Williams in South-Central Los Angeles, and Carlos Paredes of P.A. Legal each pleaded guilty to two counts of bankruptcy fraud.

Esperanza Serrano and Martha Dahdah of Latin America Legal Services, and Norman and Ivana Flores of Alpha Omega Services in Norwalk, have pleaded not guilty to charges of bankruptcy fraud, Katzman said.

Three others who were indicted--Kirk Clymer of Tenants Rights of San Diego, as well as Hugo Dahdah and Oscar Lozano of Latin America Legal Services--are fugitives, Katzman said.