Since January, Cynthia Favela had believed this Christmas would be different.

She and her five-member family are tired of sometimes not having running water or heat in their one-bedroom rental trailer. There's no room for the kids to do their homework. The worst part: rats.

So they went days eating rice and beans this year because Favela was determined to save for a house of their own and move in before the holidays. After all, the folks at Imperial Processing promised that she could buy a house despite her bad credit and low income - as long as she came up with a down payment. As of October, she had handed over $5,000, but she didn't get a house. Now, she said, she can't even get her moneyback.

"God has already covered his ears because of all of the time I cry out, 'Lord, please give us a house,'" Favela said.

The Favelas are the latest family to allege that Imperial Processing, a translation service associated with Topaz Development, tricked them into believing the thousands of dollars they turned over were down payments to buy homes. Some families who moved into the homes later discovered they signed long-term lease agreements with an option to buy the homes in the future.

Now, the Utah Division of Real Estate is investigating Lizeth "Liz" Loya, a former Imperial Processing manager, and her business associate, Jeff Blair of Topaz Development. In Spanish-language television, radio and magazine advertisements, Loya promised people she could help them buy a house or get into a bigger house regardless of their credit, immigration status and income. Loya translated for the families and led them to Topaz Development, which works to qualify people to buy homes.

The two companies housed in the same office were the subject of a Nov. 5 story in The Salt Lake Tribune.

Investigations: Derek Miller, Utah Division of Real Estate director, declined to give details about the investigation, but he said investigators are looking into a complaint that Loya was "acting as a real estate agent."

"She was putting buyers and sellers together," which would require her to have a real estate license, but neither she nor Blair has one, Miller said.

"Even if they are guilty, the most we can do is say, 'Don't do it again,'" he said.

Miguel Soria, who was featured in the November story, said he has been waiting for the return of $7,900 for at least five weeks. He gave the money to Imperial Processing and Topaz Development thinking he was buying a newly built house in West Valley City, but he later found out it was a rental agreement with a lease-to-buy option.

Soria said he was recently interviewed by an FBI agent, and he hopes investigators get to the bottom of what the two companies were doing.

A spokesman declined to say whether the FBI is investigating the companies, Blair or Loya.

Loya said she knows people are upset but "there's nothing else I can do about it." She said she no longer works for Imperial Processing nor does business with Topaz Development.

Still, Loya claims she did nothing wrong and was there to help the people as a Spanish translator. (Most of the contracts signed by the families were in English.) She claims she didn't know Favela and Soria want their money back.

Whose fault? Loya also said the families should have understood the contract before they signed it.

"The way I see it, these people are just trying to get something for nothing," she said.

Loya said she doesn't have their money because it was given to investors. She said she's referring people to Topaz to fill out paperwork to get a reimbursement in 30 to 45 days.

But Blair, Topaz Development manager, said Imperial Processing customers never deposited money with his company. He also said Topaz no longer shares office space and works with Imperial Processing - even though Nathan Blair, Jeff Blair's son, is listed as Imperial Processing's registered agent, according to state records.

"I don't have any of their money," Jeff Blair said. "They're coming to the wrong place to get their money."

Still, he said he's working with "dozens" of families that had problems with Imperial Processing, and he's trying to help them. He's giving some of them credit on a down payment, if they have proof they gave money to Imperial Processing. If they qualify to buy a house, he's trying to get them into one. If they don't, he's offering them a rental house until they can buy it.

"I'm just trying trying to be fair and clear my name," Blair said. "I don't have any association with Imperial Processing. We're not part of that company."

Limited state law: The state investigation aside, Miller said the Real Estate Division doesn't have any power to prosecute mortgage fraud cases. Most of the time, all the division can do is tell the suspects to halt improper activities, revoke their license - if they even have one - and report it to the state Attorney General's Office, the FBI and the U.S. Department of Housing and Development. Miller declined to say whether the two companies have been reported to those agencies.

"The sad truth of that is if someone is engaged in fraud, the most the division can do is tell them to stop," Miller said.

In hopes of toughening Utah laws, the division and the Utah Association of Realtors are initiating a bill in the Legislature to take "administrative action" against or heavily fine those who commit mortgage fraud whether they have a license or not, Miller said.

"If you take away the money from people, people will take notice of it," he said.

Pajamas for the kids: For Favela, government leaders taking an interest in mortgage fraud is a good start.

With Christmas less than two weeks away, Favela and her husband, who both work full-time jobs, said they're praying they'll at least get her money back and wishing for a bit more. A bed for each of their three kids. A warm shower. And being able to sleep in pajamas, instead of their coats.

"I still have hope we'll get a house," Favela said holding back tears.

Source:
http://www.sltrib.com/ci_4836648

Luis Favela gets a hug from Valentina, 7, with mom Cynthia nearby. The family has forked over thousands in hopes of getting a house, but the money has disappeared. (Chris Detrick/The Salt Lake Tribune )

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