CAMARILLO : Man Sentenced in Mortgage Fraud

A Tarzana tax preparer has been sentenced to five years’ probation for his role in a $7.6-million mortgage fraud scheme that involved the purchase of expensive houses in Ventura and Los Angeles counties.

Arnold Arend, 62, who pleaded guilty to two counts of mail fraud, was also ordered to pay $10,000 in restitution, Assistant U.S. Atty. Peter Spivack said.

The restitution is “a drop in the bucket, compared to the total losses in this case,” Spivack said.

Arend was a tax preparer for Navtej Kohli, 35, of Malibu, and Charles Myers, 49, of Camarillo, who orchestrated the complicated scheme, Spivack said. The two pleaded guilty in February and will be sentenced July 21, Spivack said.

Kohli and Myers managed to cheat banks and homeowners out of millions of dollars with the help of fraudulent escrow companies and fake buyers.

Kohli and Myers would approach owners who were selling residences worth $500,000 or more and offer to buy the property, Spivack said.

Working with two others who also plead guilty in the case, Kohli and Myers would prepare documents that actually listed the buyer as another person--a fake buyer who was paid $5,000 to $10,000 by Kohli and Myers.

The escrow papers would also inflate the sale price of the house.

“It’s a paper sell only and the real seller never sees any of the documents,” Spivack said. “It’s created solely to fool the banks.”

Arend, who could have received 60 years in prison for his role in the scheme, received a light sentence in exchange for his early cooperation and his agreement to testify against Kohli and Myers, Spivack said.

Kohli pleaded guilty in February to one count of conspiracy and 10 counts of mail fraud.

He could be sentenced to up to 305 years prison but will probably receive six to 10 years, Spivack said.

Myers pleaded guilty to one count of conspiracy and seven counts of mail fraud.

He also faces up to 305 years in prison but will probably receive between six and 10 years.