A Riverside woman was sentenced Monday in Los Angeles to two years of probation, including six months in home detention, for selling phony debt-elimination services to hundreds of distressed homeowners.
Tricia Mae Gruber, 44, was also ordered to pay restitution of $1.4 million to victims of the scheme.
Gruber pleaded guilty in May to conspiracy to commit mail fraud, admitting that she helped co-defendant James Ignatius “Jim” Diamond operate the scheme between 2010 and 2013.
Diamond, 69, also of Riverside was sentenced last month to nearly six years behind bars following his conviction on 30 fraud charges.
U.S. District Judge R. Gary Klausner reminded Gruber that her probationary sentence represented “quite a break” and resulted from her “substantial cooperation with the government” by testifying in open court against Diamond. The sentencing guideline range was 24 to 30 months in prison, the judge noted.
Gruber, a notary public and office manager, declined an opportunity to address the court.
The defendants recruited victims, many of whom did not speak English well or at all, through live seminars, presentations and written marketing materials, according to the U.S. Attorney’s Office.
The pair targeted homeowners by describing what they called a loophole in the Uniform Commercial Code regarding real estate ownership, in which the homeowner could become the creditor and the financial institution creditor/lender would become the debtor.
The programs purported to eliminate victims’ debts altogether. Prosecutors said the schemers would first collect a $3,500 advance fee, followed by other periodic fees and notary payments totaling hundreds of dollars. The average victim paid thousands of dollars, and some paid tens of thousands of dollars, according to the U.S. Attorney’s Office.
Many of the victims lost their homes, were evicted or suffered other consequences, prosecutors said. The investigation uncovered more than 500 victims with collective losses of more than $1.6 million, according to the U.S. Attorney’s Office.
Prosecutors said victims’ money was spent by the defendants on luxury hotels, jewelry, alcohol and for living expenses.
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