Roseville Couple Arrested for Loan Modification and Foreclosure Rescue Scheme

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SACRAMENTO, CA—Martin Wayne Flanders,48, and Ligia Sandoval Spafford, 46, of Roseville, were arrested today on acomplaint charging them with orchestrating a fraud scheme targeting distressedhomeowners, United States Attorney Benjamin B. Wagner announced. Flanders wasalso charged with conspiracy to commit bankruptcy fraud for filing shambankruptcy petitions as part of the fraud scheme. The complaint was filed inSacramento on September 28, 2012, and unsealed after the arrest today. Flandersand Sandoval are expected to make their initial appearances in court today inSacramento at 2:00 p.m.
According to court documents, Flanderscharged clients advance fees in exchange for a number of financial services,including loan modifications, mortgage loan audits, credit repair, debt relief,bankruptcy filings, and a program to sell homes to “investors” with arent-to-own option. Flanders and Sandoval marketed these services toeconomically distressed homeowners with particular emphasis on those who wereSpanish-speakers. During a radio program aired twice weekly by a Bay AreaSpanish-language Christian radio station, Radio Luz, Sandoval promoted theservices she and Flanders offered. Flanders also advertised on aSpanish-language television station, Univision, and in Spanish-languagemagazines. About 98 percent of Flanders’s and Sandoval’s clients were ofHispanic descent, some of whom spoke little to no English. Sandoval speaksSpanish; Flanders does not.
The investigation to date has identified25 to 30 individuals who paid for services and did not receive them for a totalloss of approximately $120,000. Some homeowners who were not able to obtainrelief were foreclosed upon by their lenders.
This case is the product of an extensiveinvestigation by the Federal Bureau of Investigation. Assistant United StatesAttorney Todd A. Pickles is prosecuting the case.
If convicted, they face a sentence of upto 20 years in prison on the mail fraud charges, and Flanders faces up to fiveyears in prison for bankruptcy fraud. The actual sentences, if convicted, willbe determined at the discretion of the court after consideration of anyapplicable statutory sentencing factors and the Federal Sentencing Guidelines,which take into account a number of variables.
The allegations in the indictment aremere accusations, and all persons are presumed innocent until and unless provenguilty beyond a reasonable doubt in a court of law.