New Charges Filed In County Foreclosure Scam

SAN DIEGO -- Five people accused of victimizing hundreds of San Diego County homeowners in a home foreclosure rescue scam were arraigned Friday on 71 new charges, including conspiracy and grand theft.

Alleged ringleader William Hutchings, 62, his wife Xiaoke Li, 45, and Shawna Landis, 36, along with Diego Gil and Edgar Martinez, now face a total of 172 charges, including felony civil code violations alleging rent and foreclosure fraud, said Deputy District Attorney Stephen Robinson.

The additional charges reflect counts against new victims and so-called "rent skimming," the prosecutor said.

Attorneys for the defendants told Judge Charles Rogers Friday that they will file a legal challenge to the alleged civil code violations. A hearing is scheduled Nov. 13.

A preliminary hearing is scheduled Dec. 1.

At a hearing in May, Robinson said the defendants allegedly offered to help homeowners keep their property by placing them in "land grants," when in fact the transactions were bogus and left the victims even worse off than they were before.

Two methods were used to get owners of residences in foreclosure to participate in the so-called land grant program, Robinson said.

One method required homeowners to pay a one-time fee of up to $10,000 to put their property in a land grant.

The second method was a lease-back scheme in which homeowners transferred their property to the defendants and then paid rent to stay in their homes.

In both scenarios, homeowners were eventually foreclosed on anyway and evicted and retained no legally recognized title to the property.

In addition to losing their homes, the victims were swindled out of hundreds of thousands of dollars, authorities said.

Martinez and Gil were arrested May 21 as they were giving a presentation to more than 50 prospective victims, authorities said.