U.S. Attorney Damien M. Diggs | U.S. Department of Justice
Three women from Texas face federal charges related to a mortgage fraud scheme, according to an announcement by U.S. Attorney Damien M. Diggs. Nicole Espinosa, known as the "Short Sale Queen," Stephanie Smith, also known as Stephanie Parks, and Selena Baltazar-Hill have been indicted by a federal grand jury on November 20, 2024.
The indictment accuses them of conspiracy to commit wire fraud affecting a financial institution and conspiracy to submit false statements to a federally insured financial institution. They have been arrested and are scheduled for an appearance before U.S. Magistrate Judge Aileen Goldman Durrett on December 4, 2024.
Court information reveals that since 2017, the defendants allegedly operated the scheme using companies such as Short Sale Queen, L.L.C. They reportedly targeted properties in pre-foreclosure short sale processes and engaged homeowners in listing agreements. The defendants then submitted fraudulent documents to financial institutions to halt foreclosure processes temporarily.
These documents included falsified purchase agreements and altered proof of funds letters from supposed buyers. Financial institutions were misled into halting foreclosures or waiving fees while the defendants attempted to find legitimate buyers or cancel deals if none were found.
It is alleged that they submitted fraudulent documents for at least 88 properties with sales totaling over $8 million, earning at least $390,000 in commissions and processing fees while causing losses of approximately $2.5 million to financial institutions.
If convicted, each defendant could face up to 30 years in federal prison.
The investigation involves the Department of Housing and Urban Development, Federal Housing Finance Agency, and Department of Veterans Affairs. Assistant U.S. Attorney Anand Varadarajan is prosecuting the case.
A federal indictment does not equate guilt; all defendants are presumed innocent until proven guilty beyond a reasonable doubt in court.
