Kevin Carter (aka Kevin Rasher) Finally In Jail for Defrauding Homeowners… But He Should be Indicted for Murder, Here’s Why

You’re about to read a shocking and tragic story.  It was very difficult to write and it won’t be easy to read.  (If you make it to the end, I’ll tell you how you can help.)

It’s a story about Linda and Joseph Presterl, an older couple from Northern California, whose lives were thrown into chaos when personal hardships struck during the worst economic meltdown this country has seen in 70 years, and they decided to apply for a loan modification under the Home Affordable Modification Program (HAMP). 

It’s a heartbreaking story that in my mind not only shouldn’t it have happened, but shouldn’t have even been possible.

This story is the epitome of why we as a nation, needed to do more, not only to prevent foreclosures, but also to stop the proliferation of scammers targeting those at risk of losing homes… stealing whatever money they had when they needed it most.

This story started for me about three months ago when I was introduced to the most brazen and devastating scam I’ve encountered during my eight years covering the foreclosure crisis.  We now know that the scammer’s real name is Kevin Rasher, but the morning that I first heard his name, it was supposedly Kevin Carter.

I wanted to post this story several months ago in the hopes of preventing others from becoming victims of Kevin Carter’s scam, however, investigators at the Justice Department and the Orange County District Attorney’s office asked me not to do so until evidence could be gathered and arrests could be made. 

Of course, I also didn’t want to do anything that would tip off Mr. Carter/Rasher and cause him to disappear before he could be apprehended and put in jail, so I agreed not to publish anything about Mr. Carter until he was behind bars… which is where he is today, held on $1 million bond.

But that’s only part of the story, so I better start from the beginning.

One morning in late April, I received a call from a lawyer and good friend, Nathan Fransen of the firm Fransen & Molinaro.  Nathan had just received a call from a couple whose home had already been lost to foreclosure and sold at a trustee sale to a third party purchaser.  I think the wife was in her 89th year, and her husband was around 90, a veteran of World War II.

Nathan explained that the couple had only learned that they had lost their home when they found an eviction notice taped to their front door.  Until that moment, they believed they were current on their mortgage payments because they had been sending them in every month without fail.

Now, I’m not saying that it’s impossible to unwind something at that stage of the process, but it’s uncommon precisely because it’s so difficult to do.  Depending on the specific facts involved, Nathan could try to help the couple by filing a wrongful foreclosure lawsuit, but that would take a great deal of time and money with no guarantee of getting the house back in the end. 

Nathan was thinking that perhaps I could help by publishing the couple’s story on Mandelman Matters, as I’ve done numerous times in the past.

So, I asked for the details and what he told me shocked me to such a degree that I felt compelled to cancel whatever I had on my calendar in order to spend the rest of that day contacting law enforcement and regulatory authorities at state, federal and local levels in the hopes of stopping a serious crime in progress.

Here’s what had happened…

Two years ago, the couple was experiencing a financial hardship as a result of unexpected medical bills and a related drop in income.  They heard about banks modifying loans to help people in need, so they called their bank, Wells Fargo, to inquire about the possibility of getting their loan modified.

The Wells Fargo representative told the couple that they should “contact a HUD counselor about the Making Home Affordable Program.” 

He also told them that they would be able to find information online, so the couple said thank you and went straight to Google to search for the same phrase the Wells Fargo representative had used: “HUD Making Home Affordable.”

The site that came up right at the very top was: www.hudmakinghomeaffordable.com.

The site claimed to be a government site, part of the Treasury Department and the HUD Making Home Affordable Program, so they called the phone number provided on the site and were connected to Mr. Kevin Carter.

Carter claimed to be an employee of the Treasury Department representing the “HUD-Making Home Affordable” program.  According to Carter, he was a graduate of Harvard Law School and his job was to help homeowners get their loans modified.

In addition to his HUDmakinghomeaffordable.com website, Carter had videos on YouTube where he explained all sorts of things related to preventing foreclosure to homeowners.

The way Kevin talked, he seemed to know everything about the banks and what they had done to cause the financial crisis.  He used all the buzz words and catch phrases that he knew would resonate with homeowners.

Kevin assured the couple that he’d be able to help them.  All he needed was for them to sign a third party authorization form that gave the bank permission to talk to him about their mortgage… and he’d handle everything from there.  There would be NO COST for his services.

So, they signed the form and Kevin leapt into action.  First, he called the couple’s servicer to let them know that he was an attorney representing the couple and that from that point forward, all correspondence should be sent to his offices and not to the couple’s home address.

Then he called the couple back to congratulate them.  He told them that their bank had agreed to modify their loan and their new trial payment would be roughly $1,800 a month.

The couple was happy to hear the good news.  It didn’t seem so unusual… after all, they had been customers of the bank for decades, why wouldn’t their bank offer to help them?  And remember, Kevin didn’t want any money from them, so how could it be a scam?

Kevin then gave them instructions for making their new trial mortgage payments.  He told them to send a cashier’s check on the first of each month made out to “HUD-Making Home Affordable.” He then gave them the mailing address to which they were to send their payments each month… it was his office address.

He added some nonsense about how their permanent modification paperwork could take months or even a year before it would arrive because the banks were so backed up, etc. etc. 

The couple had heard about the banks having problems modifying loans on the news, so what Carter was saying seemed to make sense.  All they had to do was keep making their trial payments to HUD Making Home Affordable each month and everything would work out fine.

So, that’s exactly what they did. They stopped paying Wells Fargo and started sending cashier’s checks to the address Kevin had provided made out to “HUD-Making Home Affordable” every month without fail.

Over the months that followed, whenever the couple had a question, they’d contact Kevin and he would explain it away as being just another example of what the bad banks were doing to homeowners.

He’d talk about how much he hated what banks were doing to homeowners, he’d assure them that he was on top of their case, and that they had nothing to worry about… it was just taking longer than expected… nothing that Kevin hadn’t seen before… not to worry… just keep making those trial payments.

One month, the couple couldn’t get to the bank to obtain a cashier’s check, so they sent a personal check for their payment.  They thought it would be okay just that one time… but It wasn’t.

Kevin Carter called them immediately, and he wasn’t happy at all.  Didn’t they remember that they had to send certified funds, he asked sternly?  Well, yes… they remembered and they said they were sorry, promising that it wouldn’t happen again. 

He then admonished them about sending future payments, saying: And, MAKE SURE YOU REMEMBER TO PUT YOUR LOAN NUMBER ON THE CHECK.  The couple thanked him and promised to remember to do that.

Incredibly, Kevin had opened a bank account in the name of “HUD Making Home Affordable” and was simply depositing the cashier’s checks he was receiving from homeowners each month into that account and then withdrawing the cash to support his lavish lifestyle.

After two years of making their trial payments to HUD Making Home Affordable (aka Kevin Carter), they found a notice taped to their front door.  It said that their home had already been sold at a trustee sale and that they were now being evicted.  If they failed to leave within some number of days, the sheriff would remove them from the home.

It seemed impossible, the couple thought.  How could they have lost their home, they were current on their payments?  It had to be a mistake.  They called Kevin Carter and sure enough, he was as outraged as they were.  He promised that he would contact the bank immediately and get it straightened out.

When he called back, however, he explained that what the bank had done was illegal and that to get their home back they would have to file a lawsuit against the bank.  He then referred them to a lawyer he knew, assuring them that he would testify as an expert witness on their behalf.

This time around, however, that’s when things started to unravel for Kevin Carter. 

The couple called the lawyer that Kevin had recommended, Jim Cherry, but he was located up north, near Yosemite National Park and there was no way he was going to represent a client in Southern California, an eight hour drive from his offices.

Jim Cherry’s paralegal, however, was sympathetic to the couple’s plight, so she checked online and found them a lawyer who was closer to their home and who was listed as having experience with foreclosure defense and real estate law… his name was Nathan Fransen.

That morning, Nathan and I talked at some length about Kevin Carter and his HUD Making Home Affordable scam that had unnecessarily cost this elderly couple their home, and I couldn’t remember being angrier about anything than I was that morning. 

How could this even be possible… was all I kept saying to Nathan.  How could someone open a bank account in the name: “HUD Making Home Affordable?” 

Wouldn’t that be like opening a bank account in the name: “Internal Revenue Service?” No one should be able to do that.  Nor should California’s Secretary of State have allowed a business using that name to register with the state. 

Kevin Carter had not only ripped this couple off for about $40,000, but in addition, he’d actually CAUSED this elderly couple to lose their home to foreclosure.  It was obvious to me that something had to be done about this guy and fast, before he had the chance to do it again.

Nathan started putting the evidence together.  He had the couple send him the cashier’s check receipts, along with the back of the one personal check they’d written to HUD Making Home Affordable that showed where it had been deposited… and whatever else the couple had that law enforcement might need to shut this scam down.

Meanwhile, I started calling Wells Fargo to see if anything could be done to stop the couple from being evicted, and to find out if the bank even knew what had transpired.  They didn’t.  Even Wells had Kevin Carter in their system as being with a lawyer with “HUD Making Home Affordable.”

Enter attorney Jim Cherry of Sonora, California…

Nathan and I decided that we should call the lawyer that Carter had referred in order to find out whether he was a part of Carter’s scam, but first we checked James Cherry’s record with the State Bar of California and not only was it squeaky clean, but it showed that Jim Cherry was admitted to the state bar in California in 1970, so he wasn’t an inexperienced attorney… not the sort of lawyer you’d expect to be involved in the scam Kevin Carter was perpetrating.

Even though neither Nathan nor I smelled a scammer in Jim Cherry, since we couldn’t be certain of anything in this day and age, we decided that Nathan would call Cherry and I would mute my phone and listen to the call.  That way, they could talk lawyer to lawyer without Jim knowing that a blogger who could make things public was on the call.

It only took a few minutes before it was very clear that Jim Cherry had no idea what was going on… he too thought Kevin Carter worked for HUD Making Home Affordable. 

Jim Cherry also explained that Kevin Carter had referred another elderly couple in need of an attorney to him and that couple’s story was all too familiar… after making all their payments to HUD Making Home Affordable as instructed, they too had also lost their home to foreclosure and were now being evicted.   They too were victims of Kevin Carter’s deplorable scam.

Believing that the bank had wrongfully foreclosed on the couple’s home, Jim Cherry had filed a lawsuit on the couple’s behalf against their servicer, et al, JPMorgan Chase/SLS (Specialized Loan Servicing).  So far, he had stopped the eviction and was hoping to get the bank to return the home and modify the couple’s loan. 

That couple’s name… Joe and Linda Presterl.

You already know the story, right?  The Presterl’s were also clients of Mr. Kevin Carter who worked for the Treasury Department and HUD Making Home Affordable… and they too had made over $30,000 worth of trial payments to Mr. Carter’s HUD Making Home Affordable bank account before being told that that their home had already been sold at a trustee sale and they were now being evicted.

So, having no reason not to believe Carter’s story, and believing that it was the bank or servicer that was at fault, he was suing the bank under every applicable statute.

And now, here I was, telling him that Kevin Carter wasn’t with HUD or the Treasury Department, to the contrary, he was the worst kind of con artist and thief… that the Presterls may have thought they were making trial payments, but in truth they were only paying Kevin Carter… that the money they paid was gone and unless they could qualify for a modification, so was their home.  And that Mr. Carter would not be testifying as an expert anywhere… ever.

To say that Jim was shocked would be an understatement, and for a while he struggled to accept what I was telling him, saying that he was going to call Kevin and demand an accounting of where the trial payments had gone.  I replied that he was free to do his own research, but that I was certain of my facts about Carter.

It didn’t take Cherry long to recover from the shock of learning that it wasn’t the banks that were scamming the Presterls and when we spoke again, he understood that it was Kevin Carter and was ready to work with law enforcement, but he he also said that he would continue handling the Presterls’ case in the hopes of getting SLS or Chase to grant a loan modification.  So I offered to help by calling someone at Chase to let them know what had actually happened to the Presterls (and who knows how many others.)

My contact at Chase called me back the following day to explain that it was Specialized Loan Servicing or SLS that was servicing the Presterl’s loan, and he gave me the contact information for someone in senior management at SLS so I could contact them in the hopes of helping the couple get their home back.

I felt sure that they’d be sympathetic… I mean, who wouldn’t?  And since the Presterls seemed to have enough monthly income to qualify for a modification, and because their home had not been sold to a third party, but instead had gone back to the bank, I figured that we had a pretty good shot at getting the couple’s home back.

Meanwhile, I started making calls to law enforcement, hoping to be able to find the authorities that would shut Mr. Carter down as quickly as possible.  I called HUD in Washington DC and was connected to an investigator who worked for the Justice Department.

The investigator assured me that they would investigate Kevin Carter, but he also told me that the Fed wouldn’t move quickly, so he suggested that I call the Orange County District Attorney’s Office, and ask to speak with someone in the Fraud or White Collar Crime Division.

So, I did and was connected with a long time fraud investigator by the name of John Minn.

Again, I explained that Kevin Carter was preying on the elderly, couples in their late 80s or early 90s… that he was not only stealing their money, but he was also robbing them of their homes.  I said that what Kevin Carter was doing should be considered among the most deplorable and damaging crimes ever committed.  I said that it had to be stopped fast or other elderly couples were all but certain to fall into his trap.

John Minn also explained that it would take time before they could shut Kevin Carter down and arrest him.  He said that they couldn’t just drive over there with the sirens on because he wouldn’t let them in and then he’d know they were coming for him… and he’d likely disappear.

He asked me not to write about Carter’s scam because that would tip Kevin Carter off and we might not get another chance to nail him.  I had mixed feelings about agreeing not to write about Carter’s scam because I knew that it might take the government months to build their case, and meanwhile other elderly couples would end up like the Presterls, among others.

On the other hand, I sure as heck didn’t want to be the one to cause Carter’s disappearance.

It was May 26th… the day before my birthday when Kevin Carter, whose real name is Kevin Rasher, was arrested at his Coto de Caza McMansion.  He was wearing a baseball cap and shorts as he was walked to the police car in handcuffs… click play on the video screen below to see him being arrested.  (He’s charged with scamming 380 homeowners this way.)

Now, back to the Presterls and getting their home back…

It’s worth noting that before meeting Kevin Carter, the Presterls had been ripped off for $10,000 by a lawyer in Pasadena who I remembered being disbarred a few years ago for ripping off homeowners.  And Mrs. Presterl has terminal cancer, which was what caused their hardship in the first place… a stack of medical bills not covered by their insurance.  So, as you might imagine, everyone who heard the story of Kevin Carter and what he did to the Presterls was sympathetic and willing to do whatever could be done to help.

Jim Cherry continued to work towards a settlement with the bank’s attorneys at first, and then directly with SLS.  The deal wasn’t done, by any means, but I knew that it was getting close when SLS agreed to review the couple’s application for a loan modification.

I felt confident that in the end, the couple would get their house back and I was happy to be thinking that ultimately I’d be able to write a story that, although horrifying… would have a happy ending for one couple, at least.   

People like the Presterls inspire me… I don’t know if I could endure what they have and not give up.

I spoke with Jim Cherry at length about their application, offering to have their completed application reviewed by various experts before it was submitted, just to make sure nothing was missed or done improperly.  He thanked me for whatever help I could provide and we talked about getting together were I ever visiting Sonora, California.

Jim and I stayed in touch on the Presterl’s situation, and I even made a special trip up to Sonora  to meet Jim face-to-face at the awesome mountain retreat he calls home.  Everything was going better than expected, and when I left Sonora, the plan was to get the couple’s loan modification application ready to submit to SLS in July.

Like I said, it wasn’t yet a done deal, but I was so sure that it was going to end well that I had stopped worrying about them losing their home.

That was, until a few days ago… when Jim Cherry called.

On Friday of last week, Mr. Presterl was sitting down to fill in the blanks once again on a loan modification application. but he was struggling more than anyone knew.  I guess he just couldn’t take any more of what he’d been through, being ripped off again and again as he tried to save his home.

I’m sure he thought it was all so unfair, and he was right about that.  What happened to the Presterls wasn’t fair at all… it never should have happened.  They were victims in every sense of the word… they did nothing wrong.  And I’m sure he felt terrible shame at having fallen for one scam after another.

Mr. Presterl gave up that Friday afternoon as he struggled to fill out another loan modification application.  As Jim Cherry explained to me…

“… without saying a word and with his wife in the kitchen, he took the application upstairs to their bedroom, sat in their bed and shot himself… his blood running all over the bank’s forms.”

I screamed NO! upon hearing the news, and it felt like the air was sucked out of the room.  I stood up and felt the urge to run, but didn’t know where to go.  Tears streamed down my face as I listened to Jim talk about what Mrs. Presterl had said when she called with the awful news of her husband’s death.

When we hung up, I called the Orange County District Attorney’s Office and spoke to a woman involved with the Kevin Rasher/Carter case.  I told her what had happened and said I hoped that there’d be a way to incorporate Mr. Presterl taking his life into the case against Mr. Rasher/Carter… because he should go to jail for life.

I don’t know if that even makes sense in a criminal court proceeding, but it should be something the judge or jury gets to hear about because make no mistake, were it not for what Kevin Carter/Rasher did to the Presterls, not only would they still have their home, but Mr. Presterl would still be taking care of his wife, as she continues her battle against cancer.

Not the first time, nor will it be the last…

Without question, this was the worst story I’ve ever had to write, both because of the nature of the scam and how it ended, but it’s far from being the only story of its kind… it’s only one in a series of tragic endings that should never have happened and never would have happened had we as a nation, handled the foreclosures crisis differently… better… more compassionately. 

Was is really impossible for this country to have handled the foreclosure crisis any better than we did?

I realize that foreclosures in the millions were a very difficult problem to solve, and that no one was prepared when it all started, but would it really have been that difficult to slow things down in order to get the proper systems in place to better handle the flood of foreclosures that began in 2008 and continues today, albeit at a somewhat slower pace. 

Would it really have harmed investors so terribly that Congress couldn’t grant some sort of moratorium so that the harm would be minimized or at least lessened?

What price have we paid and will we pay for allowing 10 million homeowners to lose homes to foreclosure?  How many children’s lives were scarred by growing up in homes where mom and dad were struggling to keep the family’s home?  How many suicides happened as a result of our inability to help stop a terrible injustice?  How many divorces caused by one partner blaming the other for being the one who wanted to buy that house or take out that loan?

How have all our lives been impacted by what’s been allowed to transpire over the last eight years?  How many lives have been changed permanently, but needlessly?  How many kids dropped out of high school or college because their families could no longer afford to pay for their tuition? 

How many fathers cried at night as they sat wondering if their life insurance policies would pay off after their suicide?

What price will our society ultimately pay for not doing enough to make things better?

I don’t know the answers to these questions, but what I do know is that Mr Presterl isn’t the first and won’t be the last casualty of the foreclosure crisis… and that’s just not acceptable to me, and it shouldn’t be acceptable to anyone. 

I also know what we shouldn’t let Mr. Presterl’s death pass quietly into history.  We need to scream about it… make others realize that the human cost is too great and that we need to create legislation that at the very least provides special protections to people over a certain age who are facing foreclosure.

The elderly often can’t protect themselves from foreclosure or from the scammers that exist purely to take advantage of their trusting nature, but we can’t just throw 80 year olds into the street, can we?  We let 80 year-olds refinance their mortgages for 30 years in this country, and then we act indignant when they can’t always pay as agreed?

As a nation we need to come to the realization that there are some things more important than investor returns, and that protecting people like the Presterls is one of those things.

Now I’m asking (and praying) for your help… 

SLS doesn’t make it easy to contact them via email, but they do provide a fax number you can use to contact them along with a physical mailing address, as shown below.

To reach us by fax:
You may fax your general request to:
Specialized Loan Servicing LLC
1-720-241-7218
Attention: Customer Care Support

To reach us by mail:
Specialized Loan Servicing LLC
P.O. Box 636005
Littleton, CO 80163-6005
Attention: Customer Care Support

Will you please take the time to contact SLS and tell them that they need to stand down, at least as far as the Presterls are concerned.  Mrs. Presterl shouldn’t be forced to do anything at the moment.  She has endured more than anyone should, and I simply want her to be left alone.  Her attorney, Jim Cherry, is certainly doing everything he can on her behalf, but experience tells me that there’s nothing that replaces public pressure when it comes to these sorts of things.

Please take the time to voice your support for Mrs. Presterl today, there is no time to spare and I can’t do it without you.

 

Mandelman out.

~~~

Last words…

I’m sure that most of my readers are well aware that I hear from homeowners at risk of foreclosure for one reason or another all the time.  Many times they contact me because they’re having trouble getting their mortgage modified. 

It’s not that I personally handle loan modifications, because I don’t and never have, but in order to have written hundreds of articles about the loan mod process, I have personally followed thousands of homeowners as they attempted to get their mortgages modified and I’ve interviewed bankers and other experts from all over the country… so I’ve certainly learned a thing or two about the process.

In addition, my blog has allowed me to forge some important relationships with senior executives at a few banks and servicers, so depending on the facts, I can sometimes help get something that fell through the cracks back on track, just by sending an email or making a call.

However, it’s not something for which I’m compensated, so it’s not like I advertise that I can help homeowners, or anything like that.  I just do what I can when I can, should someone find my email or phone number at the end of an article or whatever.

Sometimes homeowners contact me because they’ve been ripped off by some scammer promising to save their home from foreclosure, and when I get these calls, I can’t help but feel guilty… like, maybe if I would have made myself easier to find, they wouldn’t have been ripped off for thousands of dollars, only to lose their home anyway.

So, if you’re struggling to get your loan modified in order to save your home from foreclosure, or if you’ve been ripped off by a scammer and want whatever help or advice that I can provide, you can email me at: mandelman@mac.com.  If I can help in some way, I will.