A Laguna Beach father and son have been arrested for conspiring to inflate real estate values in an effort to obtain more business from lending institutions. The father and son would allegedly falsified appraisals and overstated the prices of properties to increase their business.

The Laguna Beach father and son have been identified as James Meritt Eaton, 60, and his son, Brian Chandler Eaton, 28. The Eaton’s were arrested last week and charged with more than 20 felony counts of grand theft, conspiracy and fraud. A third man who worked with the Eaton’s, Michael John Bell, has a warrant out for his arrest.

According to the Orange County District Attorney’s Office, James Meritt Eaton started a residential property appraisal company in Irvine called Landmark Equities Group. James Eaton hired his son Brian Chandler Eaton as president and Michael John Bell as executive.

Between June 2005 and August 2007, authorities believe the three men conspired to inflate real estate values by falsifying appraisals on residential properties in California, Arizona and Nevada. Authorities allege that the father and son team were trying to increase their business as lending companies make greater profits by giving higher loans on properties with higher appraisal values.

It is further alleged that during that time, Landmark Equities Group established a close business relationship with Quick Loan Funding, a subprime mortgage company which was founded in 2002 by Daniel Sadek wrote approximately $4 billion in subprime mortgages before collapsing five years later.

In an effort to meet the demand for the numerous appraisals that were coming in, Landmark Equities Group opened branch offices in Dublin, California, Las Vegas, and Scottsdale, Arizona. Shortly thereafter, Quick Loan Funding became the primary lender for Landmark Equities Group, which also opened a branch office within the lending institution’s Costa Mesa headquarters in an effort to further expedite the process.

The father and son also allegedly tampered with appraisals performed by other Landmark Equities Group employees by taking away negative comments and changing the appraisal values then resubmitting the revised appraisal under that employee’s name. Employees were further required to provide their passwords and electronic signatures the three men so they could access all appraisals.

The Laguna Beach father and son were arrested last week. James Eaton was arrested on December 15 while his son, Brian Chandler Eaton turned himself into police on December 18. Father and son are scheduled to be arraigned on December 30 and face up to 18 years in state prison if convicted on all counts.

Source and Image: The Orange County Register

Tags: Brian Eaton, father and son arrested, James Eaton, Landmark Equities Group, Michael John Bell

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This entry was posted on Tuesday, December 22nd, 2009

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