Ligia Sandoval Spafford, Mail Fraud, California 2016

SACRAMENTO, California – Ligia Sandoval Spafford, 48 years old, and resident of Roseville, was sentenced to 2 years and 3 months in prison by U.S. District Judge Troy L. Nunley on Thursday for a scheme that targeted homeowners in financial distress, announced U.S. Attorney Benjamin B. Wagner.

Sandoval was ordered to surrender on June 9, 2016. Sandoval paid $115,065.00 in restitution, the total amount of restitution ordered by the court, to compensate victims for the losses they incurred as a result of this scam. In February 2015, Sandoval and her then-husband, Martin Wayne Flanders, 51 years old, and resident of Roseville, pleaded guilty to mail fraud for carrying out the scam. On October 29, 2015, Flanders was sentenced to 6 years and 5 months in prison.

In the sentencing hearing, Judge Nunley said: “She knew what was going on and encouraged these people to participate in this scheme. They trusted her. … She ruined the lives of some people. The fact that she paid restitution does not take away the anxiety and fear that they (the victims) maintained while this was happening. These victims were devastated.”

According to court documents, between 2008 and 2010, Flanders charged upfront fees to his clients for a number of financial services including loan modifications, mortgage loan reviews, credit recovery, debt elimination, bankruptcy petitions, and a program to sell homes to “investors” who rented them with the option to buy. Sandoval and Flanders targeted homeowners in financial distress and placed a particular emphasis on Spanish-speaking individuals. Sandoval, a bilingual real estate agent, promoted the services offered by her and Flanders, who did not speak Spanish, during a twice-weekly radio program on Radio Luz, a Christian Spanish-language radio station in the Bay Area. Sandoval also assisted Flanders in the scam by maintaining contact with and explaining the services to Spanish-speaking clients.

The services offered by Flanders and Sandoval were also advertised on Univisión, a Spanish-language TV channel, and in Spanish-language magazines. Nearly 98% of Flanders and Sandoval’s clients were Hispanic, with some speaking little or no English. Sandoval and Flanders provided numerous false testimonies to investors about the success of the programs offered or, in some cases, the refunds that were available if the programs failed to deliver. In attempts to delay foreclosure proceedings, Sandoval and Flanders also used fake offers called “phantom offers” to buy the homes of victims at a reduced price in a process called a “short sale,” as well as fake bankruptcy petitions called “skeleton bankruptcies” that were quickly dismissed by the bankruptcy court.

At least 25 to 30 individuals paid for services they never received or did not receive refunds when the programs failed to deliver. The total losses to the victims were at least $115,000. Some of the homeowners who were unable to receive subsidies were foreclosed upon by their creditors.

This case is the result of an investigation by the Federal Bureau of Investigation (FBI). Assistant U.S. Attorneys Todd A. Pickles and Shelley Weger have prosecuted the case.

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