Juan Rangel of Downey, Calif. has been sentenced to 22 years in federal prison for running two fraud schemes—a Ponzi scheme that took in at least $30 million from more than 500 victims, and a mortgage fraud scheme that preyed on working-class homeowners by stealing the equity from their homes and secretly taking title to their properties. Rangel, who has been in federal custody since August 2008, pleaded guilty on Oct. 27 to one count of mail fraud and one count of money laundering. In the plea agreement the led to Rangel's guilty pleas, federal prosecutors and Rangel agreed to a 15-year prison sentence, but United States District Judge S. James Otero said a 22-year sentence was needed based on the devastating impact Rangel's actions had on his victims. More than a dozen victims addressed the court during the five-hour sentencing, including an investor who had been convinced to invest money she received after her son was killed while serving as a marine in Iraq. Judge Otero said that Rangel had shown a "callous disregard in taking investment money from the mother of a fallen soldier." The mail fraud count to which Rangel pleaded guilty related to a $30 million Ponzi scheme in which Rangel and his company, the Commerce, Calif.-based Financial Plus Investments, recruited investors through advertisements in Spanish-language newspapers, as well as in infomercials broadcast on television. Rangel and Financial Plus promised to pay investors annual returns as high as 60 percent, claiming Financial Plus' real estate investments and lending business generated substantial profits. However, Rangel admitted in his plea agreement that Financial Plus did not realize any profits from real estate or lending. Rangel instead used victims' money to make Ponzi payments to prior investors and for his own personal use, including the monthly mortgage payments on his $2.5 million mansion and monthly payments for his Lamborghini sports car. The investment fraud scheme resulted in losses of approximately $20 million. Rangel also admitted that he and others operated a mortgage fraud scheme targeting Latino homeowners facing foreclosure. Rather than assisting the distressed homeowners, Rangel took titles to their homes and drained the equity out of the properties. As part of this scheme, Rangel arranged to sell the homeowners' properties, usually without their knowledge, to straw buyers. He then applied for loans in the straw buyers' names, and used a variety of falsified documents to ensure that the fraudulent loans were approved. Rangel "targeted the most vulnerable members of his community—homeowners who had fallen behind on their mortgages. These families came to his company for help, and he took advantage of them for his own profit. These victims lost the equity they had built up in their properties, and many of the victim homeowners have lost their properties or are in foreclosure," prosecutors said in court papers. Court documents filed by prosecutors noted a pre-sentence report prepared in this case called Rangel's actions "depraved." Rangel admitted that the mortgage fraud scheme caused lenders to fund more than $10 million in fraudulent loans. In documents filed in relation to the sentencing hearing, prosecutors argued that Rangel's "investment fraud scheme and related mortgage fraud scheme involved a high degree of sophistication and went far beyond a typical fraud case." Utilizing dozens of employees, Rangel had recruiters sign up new investors, he conducted monthly investment seminars and he sent Spanish-speaking "street teams" into neighborhoods to target homeowners who were behind on their mortgage payments. Rangel also bribed a manager at a Bank of America branch to provide false documents and to release holds on checks he deposited into his accounts—conduct for which he was convicted at trial in a separate case in May 2009. Rangel's "fraud had a devastating impact on the families who invested with Financial Plus," according to the government's sentencing position memorandum, which details the impacts felt by several victims, which include bankruptcies and losing homes. "The victim investors were mostly working-class families, and nearly all of them invested money that they could not afford to lose. [Rangel] encouraged them to invest as much as possible and advised people against putting their money in the bank." The government is asking Judge Otero to order Rangel to pay a substantial amount of restitution to his victims. Judge Otero has scheduled a hearing for May 6 to determine how much Rangel will be ordered to pay back to his victims. In relation to the mortgage fraud scheme, a federal grand jury also indicted Javier Juanchi of Sherman Oaks, Calif., a vice president at Financial Plus, and Pablo Araque of Downey, Calif., who owns the Downey-based tax preparation and bookkeeping company A-One Tax Pros. Juanchi and Araque are currently scheduled to go to trial before Judge Otero on March 29. Rangel's son, Harold Rangel, was indicted along with his father in the case involving bribery of a bank officer. A warrant was issued for Harold Rangel's arrest when he failed to appear at a pre-trial hearing in 2009. For more information, visit http://losangeles.fbi.gov.