Federal authorities have charged a former Los Angeles man with aggravated identity theft and having operated a foreclosure-rescue scam in Southern California and elsewhere that promised to postpone foreclosure sales for more than 800 distressed homeowners.

Washington, D.C. – infoZine – Glen Alan Ward, 47, of Canada, was indicted in the Central District of California on two counts of bankruptcy fraud, one count of mail fraud and two counts of aggravated identity theft.

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In 2000, Ward became a federal fugitive when he failed to appear in court after signing a plea agreement, which stemmed from federal charges in the Central District of California associated with a similar scheme. On April 5, 2012, Ward was arrested in Canada on a U.S. provisional arrest warrant based on the charges in the Central District of California. His extradition to the United States is pending.

This indictment charges the defendant with identity theft and a scheme to defraud that took place from July 2007 to April 5, 2012, while he was a fugitive. According to the indictment, Ward led a scheme that solicited and recruited homeowners whose properties were in danger of imminent foreclosure. Ward allegedly promised to delay their foreclosures for as long as the homeowners could afford his $700 monthly fee. Once a homeowner paid the fee, Ward accessed a public bankruptcy database and retrieved the name of an individual debtor who recently filed bankruptcy. The indictment alleges that Ward also obtained a copy of the debtor’s bankruptcy petition and directed his clients to execute, notarize and record a grant deed transferring a 1/100th fractional interest in their distressed home into the name of the debtor he provided. Then, Ward allegedly faxed a copy of the bankruptcy petition, the notarized grant deed and a cover letter to the homeowner’s lender or the lender’s representative, directing it to stop the impending foreclosure sale due to the bankruptcy.

Because bankruptcy filings give rise to automatic stays that protect debtors’ properties, the receipt of the bankruptcy petitions and deeds in the debtors’ names forced lenders to cancel foreclosure sales. The lenders, which included banks that received government funds under the Troubled Asset Relief Program (TARP), could not move forward to collect money that was owed to them until getting permission from the bankruptcy courts, thereby repeatedly delaying the lenders’ recovery of their money.

As part of the scheme, Ward delayed the foreclosure sales of approximately 824 distressed properties by using at least 414 bankruptcies filed in 26 judicial districts across the country. During that same period, Ward collected more than $1 million from his clients who paid for his illegal foreclosure-delay services.

The crime of bankruptcy fraud carries a maximum sentence of five years in prison. Mail fraud carries a maximum sentence of 30 years in prison. Each aggravated identity theft charge carries a two-year mandatory, consecutive sentence.

DENVER (MarketWatch) — IRS Agent Beverly Hood testified in federal court Tuesday against a gaggle of mortgage-fraud defendants she had investigated.

What didn’t come up was that she had once been investigated for mortgage fraud herself.

Hood and her husband filed for bankruptcy in December 2009, and they lived in a half-million-dollar home in Greeley, Colo., for nearly two years without making a mortgage payment.

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At the IRS, Hood supervised several agents. One of them, she said, filed an internal whistleblower complaint against her and she was summoned by investigators.

“I had no idea why I was being called in,” said Hood, who is 49 years old. “I couldn’t figure out what I could have possibly done wrong on my tax return … They said, ‘You’re being investigated for mortgage fraud.’”

Hood was surprisingly candid about her family’s financial disaster. I had approached her in the courthouse hall during a recess in the mortgage-fraud trial where she’d been called to testify. I was expecting a “no comment.” But she not only spoke with me in the hall, but later on the phone for an hour.

“I hate that this happened, but it happened,” she said. “I’m embarrassed, but it is what it is.”

The mortgage-fraud investigation didn’t go anywhere, she said, because there was no fraud. But her bankruptcy filing and skipped mortgage payments naturally raised questions.

After all, one reason many people get investigated by the IRS is that they are in financial trouble. So agents should take care to avoid financial trouble.

IRS spokesman Dean Patterson said federal privacy laws prohibit the IRS from commenting on individual employees.

“The IRS expects its employees to meet high ethical and conduct standards, which includes meeting their tax and financial obligations,” he said. “Any allegation of employee misconduct is taken seriously and reported to the Treasury Inspector General for investigation.”

Hood knows this well. Over a quarter century, she has worked in IRS offices across the country, from Florida to Hawaii, investigating hundreds of fraud cases. She has interviewed more suspects than she can count, including real estate agents, appraisers, title companies and home buyers. She is a law-enforcement officer, and it’s her job to recommend fraud cases for prosecution, including mortgage-fraud cases.

“It’s really not my job to pass judgment on people,” she said. “It’s my job to gather the facts, and if it looks like there should be a recommendation for prosecution, move it forward.”

It is clear from Hood’s bankruptcy filing that most of her financial problems stem from her husband’s enterprises. He was a partner in a couple of Greeley restaurants that simply got wiped out in the financial crisis. The restaurants stopped paying him a salary in July 2009, according to bankruptcy records. He then worked for a percentage of profits, but when the business shut down in November 2009, there were no profits.

The couple also bought a 5,000-square-foot home in 2007 — the exact worst point to buy in real estate history.

All through the bankruptcy, Hood maintained her six-figure income at the IRS, and her family lived mortgage-free as the bank initiated mortgage-foreclosure proceedings. In addition to her income at the IRS, bankruptcy records show she held more than $200,000 in a government employee 401(k).

The Hoods had two Bank of America home loans that required combined monthly payments of nearly $4,700, according to bankruptcy-court records, compared to average monthly income that totaled less than $5,700.

“We were calling the bank, trying to get them to deal with it, but nobody wanted to talk to us,” said Hood, who is a mother of three.

A Bank of America spokesman declined comment on the case.

It’s often been reported that banks have been slow to foreclose and that people can miss payments for a year or more before they finally are evicted. It’s a trend that been dubbed “squatting in your own home.” Banks have not only been overwhelmed by a wave of foreclosures but stymied over the years by foreclosure moratoriums and delays from a robo-signing scandal.

A bankruptcy filing can complicate the process further, putting lawyers between the bank and the borrower.

Hood said she eventually received approval for a short sale. Her home sold last April, and the foreclosure was withdrawn, according to Weld County records. Her bankruptcy was discharged in November 2010.

She is now in the middle of a move to Washington, D.C., where she has become a senior analyst of planning and strategy for the agency. Her husband, she said, is working for an East Coast restaurant chain, and they are slowly recovering after shedding their debts in bankruptcy court.

Hood seemed eager to lay the facts on the table as I interviewed her. “I am telling you the truth because that’s what I do,” she explained. She said she has been completely transparent about her financial problems, informing her supervisors and the agents she supervised from the beginning. Much of her story is documented in bankruptcy-court records, but it is not a tale she ever wanted to see in print.

“I’m pretty confident I’m not the only IRS agent that has run into financial problems because of the economy,” she said. “The economy affects all of us.”