Alleges: "Junk Justice" System And Mortgage Fraud
Acting as if the May 23, 2000 closing had been authentic, Centex Home Equity filed a lawsuit against Sheu and his brother Hsu in State Supreme Court, seeking to foreclose on the property. "My nightmare was just beginning," Sheu now recalls. â€œIt was like the thief suing the victim of the crime.â€
[Black Star News Investigation]
Part One Of A Series
The man has been fighting a foreclosure for nearly 10 years.
Sun-Ming Sheu was eating Chinese noodle soup one day nine years ago when he heard a knock on the door of his Queens house.
When Sheu stepped out, he found an agent from Tower Insurance who told him that he was there to inspect the house for its new owner. "I almost choked on my soup," Sheu recalled in an interview with The Black Star News.
Sheu says he had never sold his house.
Earlier, he had worked with Manhattan-based mortgage brokers to refinance the house, which was under the name of his brother, Ming Chien Hsu. It turns out that the mortgage broker, Yek-Yun Chiu (a.k.a. Roman Chiu) and other accomplices, had forged his brother Hsu's signature on a power of attorney and applied for a mortgage loan with Centex Home Equity.
The forged power of attorney was signed and dated February 11, 2000; Sheu's brother, Hsu, was later able to prove that he was actually in Taiwan on that date and could not have signed the document.
Sheu immediately reported the fraud to the police and obtained a complaint report #7167, on June 19, 2000, from the 109 precinct, in Queens. Sheu also reported the matter to the Queens County District Attorney's office and to the Manhattan D.A., since the fraudsters worked in Manhattan.
On June 19, 2000, Sheu faxed a copy of the police complaint he had filed, to Ed Folland, a Centex official, and B. Osterman, director of collection, at Centex, alerting them to the fraud. Sheu also spoke with both officials by phone. “Folland said he would investigate,” Sheu said.
Sheu also faxed a copy of the police complaint on the same date to Old Republic National Title Insurance Company, which provided title insurance for the May 23, 2000 closing. He also reported the fraudulent mortgage loan to Midwest Finance, which was the agent for Chase Bank of Texas, the original mortgage lender to his brother, Hsu.
Sheu said he warned Centex to recover its money, since the mortgage had been fraudulently obtained. He said he was confident things would soon be resolved once Old Republic issued him with a claim #43391, after he had written a letter to the New York Department of Insurance, complaining about the fraudulent conveyance.
The letter from Old Republic with the claim number, reviewed by The Black Star, is dated October 5, 2004, and was signed by Felice K. Shapiro, then Vice President, New York State Counsel. The claim was assigned to Timothy McLeron, then the New York State Claims counsel for Old Republic.
Rather than deal with his claim, Sheu says, Centex and Old Republic decided to pretend as if the May 23, 2000 closing was not fraudulent, even though he provided both companies with documentation.
Instead, Centex later filed a lawsuit to foreclose on the property, Sheu says. “It was like a thief suing the victim. They conspired to steal my property," Sheu claims.
Nine years later, Sheu has been foreclosed on his property by Old Republic, which substituted for Centex as plaintiff, in 2008.
Separately, officials at both Centex and Old Republic did not return phone calls and e-mail messages from The Black Star seeking comment.
A lawyer for Old Republic, Matthew Dollinger, did not respond to an e-mail message with detailed questions. A spokesman for the New York State Department of Insurance did not return a phone message and e-mail message by publication time. Similarly, a spokesman for the New York State Attorney General did not respond by publication time.
At the fraudulent closing, on May 23, 2000, two associates of the broker, Yek-Yun Chiu, participated in the scam, Sheu says. Amy Cheng, whose real name is Jin Rong Wang, acted as the “buyer” of the property. She carried multiple identifications, and used the fake one, "Amy Cheng" for the closing. Her boyfriend Jing Gao, acted as the “seller.”
The pair was later busted by police and pleaded guilty on forgery charges.
Jin Rong Wang, the supposed buyer, did not even make the required $30,000 down payment on the property, Sheu says. Yet the deal was okayed by Centex’s lawyer, Brooklyn-based attorney Jakov J. Bohensky, Sheu says.
Bohensky’s name appears on the federally-required HUD-1 document certifying that the $30,000 downpayment was made; although his signature is not on the form.
The Black Star News has also reviewed photocopies of what purports to be checks made out by Bohensky in connection with the transaction. One check, purportedly made out to Ming Chien Hsu, Sheu’s brother, is for $4,112.60; Sheu says it was also a fake check since his brother was not selling the property, and, in any case, was not even in the country and never received the check.
Another check, purportedly for $1,000 was to Jeffrey Ruan, who was supposed to have been Jing Gao’s, the “seller’s” lawyer.
A copy of what purports to be a money order for $1,000, one of several payments towards the purchase of the house, made out to Sheu’s brother, Hsu, by Amy Cheng, is drawn from Abacus Federal Savings Bank, in Chinatown. Canal Street is mispelled “Cannal Street.”
In an interview Ruan told The Black Star News that when Sheu later told him about the forgery, he wrote to Old Republic urging that the company not transfer the title pending resolution of the alleged forgery.
"What I cannot understand is how Centex's lawyer at the closing went along with this scam," Sheu says, in the interview. “He must have known it was fraudulent as the detectives said.”
Bohensky did not return a phone message from The Black Star News seeking comment.
The Black Star News spoke with one of the New York Police detectives who looked into Sheu's allegations in 2000. He said he was able to confirm that it was a forged power of attorney and that Sheu's brother, Hsu, was not in the country and could not have signed it in front of the notary public. He said bank records also showed that some purported deposits were actually never made.
Sheu also blames Midwest Finance, the agent for Chase Bank of Texas, his brother's mortgage holder, for not returning the money to Centex after he notified the company of the 2000 forgery. Contacted by The Black Star News, a Midwest official confirmed that Sheu's mortgage had been paid off; he wouldn't provide additional information.
Even after the May 23, 2000 fraudulent “closing” Sheu says, he wasn't too worried initially because he believed once he had reported the fraud to police and the DA, things would eventually be sorted out.
"It was the court system that later betrayed me," says the immigrant from Taiwan." Is this the American way?"
Acting as if the May 23, 2000 closing had been authentic, on January 10, 2001, Centex’s title insurer, Old Republic, recorded the property's deed and mortgage with the New York City Register, in Queens County. Old Republic listed Sheu’s brother, Ming Chien Hsu, as the first “party” and Jing Gao, the phony "seller" at the May 23, 2000 "closing" as the second “party.”
"This was knowingly criminal," Sheu claims.
Then on December 12, 2001, Centex filed a lawsuit against Sheu and his brother Hsu in State Supreme Court, in Queens County, seeking a default judgment on the property, arguing that Amy Cheng was not making payment on the mortgage, even though Cheng was the fictitious name of the buyer at the fraudulent May 23, 2000 closing.
So, in addition to Sheu and Hsu, Centex listed as co-defendants, the very individuals that had victimized the brothers: Jin Rong Wang (a.k.a. Amy Cheng); her boyfriend Jing Gao; and the broker who presided over the fraudulent May 23, 2000 "closing," Yek-Yun Chiu. Non of the fraudsters ever appeared in court.
The case was assigned to Justice Joseph Golia in State Supreme Court in Queens.
"My nightmare was just beginning," Sheu now recalls. “It was like the thief suing the victim of the crime.”
Sheu says had Judge Golia granted him due process, including disclosure, he would have quickly exposed the fraud perpetrated against him and had the case would have been thrown out.
Instead, Judge Golia granted summary judgment in favor of Centex and foreclosed on the property on July 21, 2004, records show.
Sheu continued to complain to Centex. A September 23, 2004 letter to Sheu's brother, Hsu, by Gerry King, a customer relations officer at the company acknowledges receiving “numerous faxed letters and copies of various documents” from Sheu but adds that “it was the decision of the court that insufficient evidence to prove fraud was provided and the Supreme Court of the State of New York issued a judgment of foreclosure...”
“There was no deposition; no discovery; so how could I present evidence to show fraud?” Sheu says, in the interview with The Black Star.
Sheu says even though Centex knew its May 23, 2000 originated mortgage was fraudulent, it was now using the Court system to legitimize the transaction.
The foreclosure sale was on January 28, 2005. “Centex bought the property for $1,000 from Amy Cheng, the fraudster,” Sheu says. “That was not even her real name. How can you buy property from someone who does not exist?”
A week after Centex “bought” the property, on February 2, 2005, both Jin Rong Wang (a.k.a. Amy Cheng) and Jing Gao, who had never appeared in court on the Centex case, were arrested based on the criminal forgery complaint filed by Sheu in 2000.
Sheu sent a fax to Centex’s Gerry King about the development and also informed Judge Golia. Sheu says he was appalled so he also wrote a letter to New York State Chief Administrative Judge, Jonathan Lippman, complaining about how his brother's property had been "stolen." He accused Golia of “bias” and “discrimination.”
Sheu says on February 3, 2005, Jason Garlick, an Assistant District Attorney at the Queens County DA’s office, who had prosecuted Jin Rong Wang (a.k.a Amy Cheng) and Jing Gao, called him and asked him not to contact media about his case. “Judge Golia must have called the DA’s office because I told him I was going to media,” Sheu says.
Judge Golia ordered a hearing for April, which was later moved to May 18 and 19, 2005.
The order was signed by Judge Golia on March 17, 2005 and stamped with the Queens county clerk’s seal on March 23, 2005. Sheu says when he’d last checked court records on March 24, 2005, there was no such entry or copy of such an order.
In fact, Sheu says, the only order he found in the records at the time, signed by Judge Golia on March 17, 2005, and stamped with the Queens county clerk’s seal on March 23, 2005, was a denial of Sheu’s and his brother, Hsu’s motion for Judge Golia to
After the May hearing, it was not until nearly a year later, on April 12, 2006, that Judge Golia returned with a ruling on the case.
Judge Golia again denied the defendants’ motion that he recuse himself; the judge cancelled the fraudulent deed of May 23, 2000 between Ming Chien Hsu and Jin Rong Wang (a.k.a Amy Cheng); he cancelled the foreclosure order filed on July 21, 2004; and, he cancelled and vacated the foreclosure sale of January 28, 2005.
Judge Golia, however, did not restore Ming Chien Hsu’s (Sheu’s brother) original 15-years $226,500 mortgage with SMI Mortgage (SMI had later assigned the mortgage to Chase Bank of Texas).
"This violated my right as a crime victim to be restored to original status," Sheu says, reading from papers he had pulled from research.
That wasn’t all.
Judge Golia awarded Summary Judgment in favor of Centex to foreclose an equitable mortgage, under the doctrine of Equitable Subrogation against the premises: he ruled that Centex had paid off the original mortgage.
"How can equitable subrogation apply to stolen property?” Sheu asks. "This means if I have a lot of money, like Centex, I can pay off anybody's mortgage anywhere without their permission and then take possession of their home and kick them out," Sheu noted, sarcastically.
Judge Golia did not return phone calls seeking comment and also didn’t respond to an e-mail message. In a phone interview, Mitchell Kaufman, Judge Golia’s law secretary claimed Sheu’s information about the fraud would not have made a difference in the case “if Centex did not know at the time” of the May 23, 2000 closing that it was based on the forged power of attorney. “Apparently Mr. Sheu is either unwilling or unable to accept the judgment of equitable subrogation.”
Sheu retorts: “Centex knew it was a fraudulent transaction. It was represented by an attorney—Bohensky and the fraudulent transaction was endorsed by Joseph Bigman, Old Republic's title agent. In any case Old Republic issued me a claim number and they still did nothing except to foreclose.”
Asked what if Centex did know, or came to know that the May 23, 2000 closing was fraudulent Kaufman said, of Sheu: “He may have a tort claim against Centex.”
Judge Golia appointed Martin Evans as referee charged with computing the amount owed to Centex by Sheu. Evans entered a judgment amount of $465,433.29 in favor of Centex.
Golia also ruled that Centex could move for a judgment of foreclosure and sale, with costs, disbursements and any additional allowance as allowed by law.
Separately, Dollinger, Gonski & Grossman, the law firm representing Centex (now representing Old Republic, since it substituted as the plaintiff), managed to get a satisfaction of mortgage document from Chase Bank of Texas, even though the mortgage was in the name of Mr. Sheu’s brother, Hsu.
Sheu said when he called Midwest, Craig K. Olson, a Vice President, told him that a lawyer from Dollinger had informed Midwest that the firm represented Sheu and his brother, Hsu.
Judge Golia issued a judgment of foreclosure sale on April 7, 2009. The foreclosure sale occurred on May 15, 2009.
On May 27, Sheu appeared before Judge Golia with Stephen Katz, an attorney, and Judge Golia denied Sheu’s motion to vacate the order for foreclosure and sale.
In his motion, Sheu said Old Republic was foreclosing on a loan “obtained by fraud and by forgery of a power of attorney,” to which Judge Golia wrote: “This assertion is intentionally misleading and disingenuous at best.”
"It is the truth," Sheu says. "It is nothing but the whole truth."
In the almost decade he's been fighting for the property, Sheu has learned a few things about the law. He pulls out information he’s researched and reads, "Part 100 of the Rules of the Chief Administrator of the Courts Governing Judicial conduct. Section 100.3. Disqualification. A judge shall disqualify himself or herself in a proceeding in which the judge's impartiality might reasonably be questioned, including but not limited to instances where the judge has a personal bias or prejudice concerning a party or the judge has personal knowledge of disputed evidentiary facts concerning the proceeding."
In June 2009, Sheu met twice with a criminal investigator at the U.S. Attorney’s Office in the Southern District for a total of about four hours and discussed his case and submitted documentation. “We cannot confirm or deny that we are investigating this case,” the investigator told The Black Star News, when contacted by phone.
"These seem to be issues for the Appellate Division as I am not in position, nor am I qualified, to say whether or not a Judge's
decision was 'proper' or not nor am in a position to say what rule of law should have been used to decide a particular case," David Bookstaver, Communications Director for the New York State Unified Court System Office of Court Administration told The Black Star News.
Desperate, on June 23, 2009, Sheu again filed an order to show cause for a temporary restraining order to halt any further action even though the sale had already occurred.
He demanded that detectives Keith Ng and Kin Lee, now both retired, who both had investigated the fraudulent May 23, 2000 closing, be permitted to testify.
Judge Bernice D. Siegal, stayed any additional proceedings with respect to sale of the property, with a return hearing date of July 8, 2009.
At the July 8, hearing, Judge Golia set another hearing date for July 15, 2009, at which time Sheu was to produce cancelled checks for all payments he had made over the last nine years on the property, for taxes; insurance payments; and, utilities.
This reporter attended the July 15, 2009, hearing and observed the clearly acrimonious relationship between Judge Golia and Sheu. The Judge Golia kept shouting at Sheu, who was unable to produce receipts; Sheu on the other hand kept shouting at the judge about the May 23, 2000 fraudulent conveyance he insisted was at the root of his predicament.
“This is junk justice,” Sheu said, as he walked out of the court. "Nobody is above the law, except Judge Golia."
Note: Readers if you believe you’ve been the victim of a mortgage scam and have documentation please contact Milton@blackstarnews.com or call (212) 481-7745
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