Houston, TX. — A 62-year-old California resident has been sentenced to more than 10 years in federal prison for leading a sprawling, multimillion-dollar mortgage and loan fraud operation that targeted lenders, government programs, and people with poor credit histories, federal prosecutors announced.
Steven Tetsuya Morizono, also known as Jeff Lucian, of Mission Viejo, pleaded guilty in March to 34 counts including bank fraud, wire fraud, mortgage fraud, conspiracy to make false statements to the Federal Trade Commission, and obstruction of an official proceeding. U.S. District Judge Keith P. Ellison sentenced him to 121 months in prison, followed by three years of supervised release. Restitution will be determined later.
According to court records, Morizono recruited his brother-in-law, Albert Lim (aka Ted Chen), 56, and longtime friend David Best, 62, to help operate “Jeff Funding,” a business used to carry out the nationwide scheme. Prosecutors said the group submitted falsified loan applications, created shell companies, deployed straw buyers, and offered fraudulent credit repair services tied to properties in Spring, Texas.
“This wasn’t just paperwork fraud, this was a calculated and opportunistic nationwide scheme designed to manipulate mortgage lenders, banks and people with poor credit histories, for personal gain,” said U.S. Attorney Nicholas J. Ganjei. “These criminals exploited every opportunity — from banks to the housing market to the pandemic – to enrich themselves at the expense of taxpayers, banks, and honest Americans.”
Investigators found the group recruited individuals with poor credit, filed false identity-theft claims to boost their credit profiles, and submitted fake pay stubs for personal loans. Once loans were approved, the conspirators skimmed off the proceeds, leaving borrowers burdened by debt. They also used straw buyers to purchase homes, collected rent and pandemic assistance on those properties, and then allowed them to fall into foreclosure.
During the COVID-19 pandemic, prosecutors said the group expanded the scheme to include federal relief programs such as the Paycheck Protection Program and Economic Injury Disaster Loans by filing hundreds of fraudulent applications.
The conspiracy, which began in 2017, led to 17 convictions, including mortgage brokers Heather Campos and Kimberli Ann Tomman and multiple straw buyers. Campos and Best initially fled after their indictments but were later arrested in Utah.
Sentences for co-conspirators include 94 months for Campos, 84 months for Lim, and 60 months for Best.
The Federal Housing Finance Agency-Office of Inspector General led the investigation with assistance from the U.S. Postal Inspection Service, IRS-Criminal Investigation, SBA-OIG, HUD-OIG, and FTC-OIG. The U.S. Marshals Service, FBI, and multiple local law enforcement agencies assisted in apprehending fugitives.
Assistant U.S. Attorneys Kate Suh and Jay Hileman prosecuted the case.
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