Darnell Bell, also known as D-Bell a San Diego gang member pleaded guilty to participating in a racketeering conspiracy that involved bank fraud, money laundering and other crimes.
Prosecutors in the case say that Mr. Bell was the chief orchestrator of the mortgage fraud scheme. The scheme that resulted in approximately fifty million dollars in real estate losses was conducted by using straw buyers, fraudulent mortgage loan applications and fraudulent escrow document on over one hundred properties in San Diego County.
Mr. Bell is the fourth individual and the second principal to plead guilty in an indictment that named twenty four people which was unsealed last year. Michael Ivy, the owner of The Real Estate Center of La Mesa pleaded guilty to a conspiracy charge earlier. Mr. Ivy is currently awaiting sentencing.
The conspirators ran their scheme to defraud lenders between 2005 and 2008. They identified properties that had been on the housing market for months then used straw buyers to obtain the properties. The ring used the one hundred percent purchase loan program to borrow money from lenders and obtained inflated appraisals. The conspirator also paid more than the asking price for the properties involved. The difference was put into an escrow account in a bogus construction company’s name. The construction company was set up by Mr. Bell. The money was to be used for retrofitting homes for the disabled and no work was ever done in that regard.
The straw buyers walked away from the properties and the financial institutions were forced to foreclose resulting in huge losses to the financial institutions.
Mr. Bell is a member of the Lincoln Park Street Gang in San Diego and used his status in the gang to recruit other members and enforce discipline among the web of conspirators in the scheme. The conspirators include appraisers, a notary, an escrow officer, a tax preparer and a real estate broker.
Nine million dollars in proceeds were found in the bogus construction account that was set up by Mr. Bell when the conspiracy ring was broken up. Mr. Ivy was alleged to have received over two hundred thousand dollars over the course of the three years the ring was working the scheme.
The United States Attorney’s Office declined to comment on the Mr. Bell’s plea agreement as the case is still active. Stanley Gentry, a real estate broker is still facing charges for allowing the ring access to the multiple listing service in which he received ten thousand dollars per month. Billie Bishop, the escrow officer is facing charges on over one hundred transactions.
Trail dates have not been set in regard to the straw buyers in the case. Court documents show that plea agreements are on the table for some of them involved. One of the straw buyer’s lawyers stated that a “package deal” has been proposed for eight of the straw buyers involved. The eight defendants must all agree on the proposal or none of them get the deal on the table.
Marcus Dozell, a straw buyer in the case pleaded guilty to racketeering conspiracy. Mr. Dozell was sentenced in February to forty six months in prison. Mr. Dozell recruited other straw buyers and received payment in an amount of one hundred thousand dollars.
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