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The first person to be sentenced in the $50 million foreclosure-prevention scheme sentenced to 20 years in prison

The first person to be sentenced in the $50 million foreclosure-prevention scheme sentenced to 20 years in prison

Developer who bilked condo buyers in Coachella resort scam gets 20 years in prison

A convicted fraudster who bilked out-of-state buyers of Coachella’s luxury condos in a $50 million foreclosure-prevention scheme was sentenced Thursday to 20 years in prison, the Los Angeles County District Attorney’s Office said.

Spencer Lee and seven other individuals — including the original defendants in the case — were convicted in July of grand theft. Lee was also convicted of three felonies, and his co-defendants were convicted on charges of grand theft, perjury and fraud.

Lee received 10 years in prison for his role in the scheme. He was also convicted of a felony charge of perjury and eight misdemeanors.

Lee and the other defendants sold dozens of luxury Coachella condos that were advertised as available for $2.5 million each. But the buyers found out that the condos were already foreclosed on or had been resold and did not get their money.

Lee and others got the buyers to sign a HUD-1 Settlement Statement before the sale date that says the property is not in foreclosure, according to prosecutors.

Lee is the first person to be sentenced in the case and faces a maximum sentence of 20 years in state prison. If he is convicted of all charges, he could face up to six years in state prison for falsifying the HUD-1 settlement statement, and up to 10 years for each of his 20 grand theft convictions.

Prosecutors declined to recommend the maximum sentence. However, they said a prison sentence would serve the purposes of restorative justice, and is the appropriate sentence for the crime.

“The victims here will never see the money they trusted would be theirs, but they will be able to go back in time and find a way to right that wrong,” Los Angeles County District Attorney Jackie Lacey said.

A third person not charged in the case, Thomas Zillman, was found guilty of lying in a HUD-1 Settlement Statement during the course of the scheme. The statement is required to be made even when a property is not in foreclosure.

He was sentenced to 30 years in prison.

The scheme was exposed late last year when federal prosecutors filed an indictment accusing a man who claimed to be the owner of the luxury condos and was selling them through a company he operated. His claims were all lies, prosecutors said.

The company he ran was

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