Dorothy Matsuba Led $30M Mortgage Relief Fraud Scheme

Dorothy Matsuba, 65, is accused of masterminding a $30 million mortgage relief fraud scheme that preyed on desperate homeowners across California. Federal prosecutors unsealed an 18-count indictment today charging Matsuba — also known as Yun Soon Matsuba — and four other Los Angeles residents with conspiracy to commit wire fraud, make false statements, and carry out aggravated identity theft. The alleged fraud spanned nearly a decade, from 2005 to 2014, and left dozens of families homeless and financially gutted.

The defendants — Thomas Matsuba, 64; Jane Matsuba Garcia, 40; Jamie Matsuba, 31; and Young Park, 53 — were tied to a network of shell companies, including Ownership Management Service LLC and Trust Holding Service LLC. These entities claimed to help distressed homeowners avoid foreclosure through short sales. Instead, prosecutors say the defendants used deceit and forged documents to seize control of properties, collect rent, and delay foreclosures while pocketing millions. Thomas Matsuba is Dorothy’s husband; Jane and Jamie are her daughters; Young Park is her brother.

According to the indictment, the scheme worked like this: homeowners were convinced to sign over their deeds to trusts controlled by the Matsubas, under the promise their mortgages would be paid and their homes sold through short sales. Many moved out, believing the plan would save their credit and housing. But the defendants allegedly stopped making mortgage payments, submitted fake offers to lenders, and turned the properties into rental units — profiting while the banks and homeowners absorbed the losses.

Dorothy Matsuba faces five counts of wire fraud, five counts of making false statements, and six counts of aggravated identity theft. Jane Matsuba Garcia is charged with one count of wire fraud, two counts of making false statements, and one count of aggravated identity theft. Jamie Matsuba is charged with making a false statement. All four were arrested this morning in Chatsworth and Koreatown and are scheduled for court appearances this afternoon. Young Park remains at large and is currently listed as a fugitive.

“These defendants are charged with preying upon distressed homeowners with false promises of keeping their homes,” said U.S. Attorney Eileen M. Decker of the Central District of California. “Instead, the defendants callously pocketed tens of millions of dollars for themselves while hastening foreclosure of the victim homeowners’ properties.”

Assistant Director Deirdre Fike of the FBI’s Los Angeles Field Office emphasized the emotional toll on victims: “Today’s arrests illustrate the FBI’s commitment to combat fraud targeting homeowners, as in the case of the Matsuba family, whose members are charged in a scheme that targeted emotionally distraught victims, many of whom were losing their jobs and facing the loss of their homes. In addition to giving false hope, the defendants enriched themselves while victims lost their homes and had their credit destroyed.”