Home For Sale in Peoria, Arizona

Douglas Ross Zuber, Former Scottsdale Real Estate Exec Charged with $10M Theft

Douglas Ross Zuber, a former executive at a Scottsdale real estate development company has been charged with embezzling more than $10 million from the firm.

The Arizona Attorney General's Office says 40-year-old Douglas Ross Zuber of Phoenix funneled company cash into bank accounts he controlled. He then created fictitious vendors, opened bank accounts in their name and submitted invoices for payment to his employer.

Zuber was executive vice president at Harvard Investments, Inc. from 1999 through 2006. The company discovered and investigated the fraud and then turned the case over to the attorney general.

Zuber was indicted on one count of money laundering, one count of theft and one count of fraudulent schemes and artifices. A telephone listing for Zuber was disconnected.

Contract worker for Fannie Mae accused of selling appliances from foreclosures

Police say Jamie Pantastico sold appliances from foreclosed homes on Craiglist while he was a contract worker for Fannie Mae.

Chandler Police are looking for potential victims that may have been connected to a fraud scheme where appliances were re-sold from foreclosed homes.

Jamie Pantastico, 39, was employed by Fannie Mae as a contractor to clean foreclosed homes to prepare them for re-sale. He would enter the homes by having access to their lockboxes and take photographs of the appliances - then place ads on Craigslist.

Pantastico met potential buyers at the homes posing as the homeowner. After the appliances were sold and removed from the house, he would return the keys in the lockbox.

He was arrested in Queen Creek by the Maricopa County Sheriff's Office and Chandler Police on September 25.

Victims are encouraged to call the Chandler Police Department at 480.782.4130.

Phoenix home prices falling big time

Phoenix is faring worse than most cities according to the Standard & Poor's 20 City Housing Index.

NEW YORK (AP) _ A closely watched index shows Valley home prices tumbling by the sharpest annual rate ever in July.

The newly released Standard & Poor's/Case-Shiller 20-city housing index showed a record drop of 16.3 percent in July from the year-ago period - the largest drop since its inception in 2000. The 10-city index plunged 17.5 percent, its biggest decline in its 21-year history.

Home values in all 20 cities fell year-over-year, with Phoenix faring worse than most cities. Prices Valleywide plummeted more than 29 percent in July from one year ago.

The only metro area doing worse than Phoenix is Las Vegas, where prices are plunging at nearly 30 percent.

However, the pace of declines has slowed over the last three months, but there is still no sign of a bottom, one of the index creators said.

Arizona gets federal cash on foreclosure impact

Arizona is getting federal money to help communities cope with the effects of foreclosures.

The Governor's Office says the Department of Housing and Urban Development will provide $38 million to the Arizona Department of Housing.

According to the Governor's Office, the neighborhood grant money can be used by local governments and non-profits to buy foreclosed homes, rehabilitate them and make it available to home buyers.

That helps communities by reducing the number of vacant homes, a step that helps combat crime.

I'm not so sure how this will be conducted. This story leaves me with a lot of questions to tell the truth.

FBI investigating companies at heart of meltdown

The FBI is investigating four major U.S. financial institutions whose collapse helped trigger a $700 billion bailout plan by the Bush administration, The Associated Press has learned.

Two law enforcement officials said Tuesday the FBI is looking at potential fraud by mortgage finance giants Fannie Mae and Freddie Mac, and insurer American International Group Inc. Additionally, a senior law enforcement official said Lehman Brothers Holdings Inc. also is under investigation.

The inquiries will focus on the financial institutions and the individuals that ran them, the senior law enforcement official said.

The law enforcement officials spoke on condition of anonymity because the investigations are ongoing and are in the very early stages.

Officials said the new inquiries bring to 26 the number of corporate lenders under investigation over the past year.

Spokesmen for AIG, Fannie Mae and Freddie Mac did not immediately return calls for comment Tuesday evening. A Lehman spokesman did not have an immediate comment.

Just last week, FBI Director Robert Mueller put the number of large financial firms under investigation at 24. He did not name any of the companies under investigation but said the FBI also was looking at whether any of them have misrepresented their assets.

Over the past year as the housing market cratered, the FBI has opened a wide-ranging probe of companies across the financial services industry, from mortgage lenders to investment banks that bundle home loans into securities sold to investors. Mueller has previously said the FBI's hunt for culprits in the nation's subprime mortgage crisis focused on accounting fraud, insider trading, and failure to disclose the value of mortgage-related securities and other investments.

The investigations revealed Tuesday come as lawmakers began considering whether to approve emergency legislation that would give the government broad power to buy up devalued assets from troubled financial firms.

The bailout proposed by the Bush administration is aimed at helping unlock credit and stabilize badly shaken markets in the United States and around the globe.

In the past two weeks, the government has taken over Fannie Mae and Freddie Mac, the country's two biggest mortgage companies, with a bailout plan that could require the Treasury Department to put up as much as $100 billion for each of them over time if needed to keep them afloat as mortgage losses mount.

Last week, the Federal Reserve provided an emergency $85 billion loan to AIG, which teetered on the brink of bankruptcy. Lehman Brothers was forced to file for bankruptcy after attempts to engineer a private rescue fell apart. All the companies were laid low from bad bets on complex mortgage-related securities.

Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke made the joint decision last week that the only way to stop the carnage was to deal with the root cause of all the troubles, billions of dollars of bad mortgage debt sitting on the books of major financial companies. This debt has triggered the worst credit crisis in decades, causing credit markets to essentially freeze up despite the fact that the Fed joined with major central banks around the world to pump billions of dollars of reserves into the financial system.

Additionally, the FBI is investigating failed bank IndyMac Bancorp Inc. for possible fraud. Countrywide Financial Corp., formerly the nation's largest mortgage lender and now owned by Bank of America Corp., is also under scrutiny.

Could the Fannie and Freddie collapse help borrowers?

The government's takeover of mortgage finance companies Fannie Mae and Freddie Mac should provide an opportunity to modify more home loans for troubled borrowers, a top government official said Wednesday.

The takeover, announced earlier this month, will allow regulators to ``take a look at the loans and see what can be modified,'' said Sheila Bair, chairman of the Federal Deposit Insurance Corp., in testimony before a House committee.

With 1.5 million foreclosures last year and 1.2 million already in the first six months of this year, the foreclosure crisis is accelerating, she said.

``There are still a lot of mortgages out there that need to be restructured and families that can still be helped,'' Bair told the House Financial Services Committee.

Under her stewardship, the FDIC has rolled out a plan to help refinance delinquent homeowners into 30-year mortgages with interest rates currently capped at 5.9 percent. The FDIC introduced the program about a month ago after it seized IndyMac Bank.

Some lawmakers want to see if the program can be replicated among loans held by Fannie Mae and Freddie Mac.

Fannie Mae and Freddie Mac bought loans from IndyMac, Washington Mutual and many other banks as part of their official role in supporting the housing market. But the government-sponsored companies ran into trouble when those loans started defaulting at an alarming pace, scaring off investors and putting upward pressure on interest rates.

Treasury Secretary Henry Paulson and James Lockhart, director of the Federal Housing Finance Agency ``actively looking'' at expanding loan modifications among the more than $5 trillion in loans that Fannie and Freddie own or guarantee, Bair said.

Her efforts have the backing of the committee's chairman, Rep. Barney Frank, D-Mass.

``We will be urging others to follow your model,'' Frank told Bair. ``I think you are setting a very good example here.''

More than 1,200 homeowners with mortgages from failed IndyMac Bank are participating in the agency's effort to refinance the loans and stem the tide of foreclosures _ a number is expected to rise dramatically.

So far, the FDIC has mailed out more than 7,400 offers to modify loans, and participating borrowers have saved an average of $430 on their monthly payments. The agency estimates that about 40,000 of IndyMac's 60,000 delinquent mortgages are eligible for the program.

The agency has been operating the Pasadena, Calif.-based bank, now called IndyMac Federal Bank, under a conservatorship since July 11.

And there are concerns on the FDIC might get saddled with an even bigger problem: Washington Mutual Inc., the nation's largest savings and loan.

To avoid that, the government has been reaching out to large banks in an effort to organize a buyout of the beleaguered lender, according to a person briefed on the talks between regulators and banks.

Shares of Washington Mutual have plummeted in recent weeks amid continued concerns about mounting losses in the bank's lending portfolios. The lender lost $3.33 billion, or $6.58 a share, in the second quarter and set aside more than $8 billion to cover souring loans.

Earlier this summer President Bush signed a bill that aims to prevent foreclosures by allowing an estimated 400,000 homeowners to swap their mortgages for more affordable loans, but only if their lender agrees to take a loss on the initial loan. That program starts Oct. 1, but some lawmakers are questioning whether that program will do enough to stem the foreclosure crisis.

``Voluntary may just not be good enough'' said Rep. Jackie Spier, D.-Calif.

Executives from Citigroup, JPMorgan Chase and Bank of America and Wells Fargo, all told lawmakers they are boosting their staff and making preparations to put the new program in place. Bank of America and Wells Fargo officials said they are postponing foreclosure sales for customers who may qualify for the government-backed refinancing effort.