A San Diego County couple whose Ramona home was destroyed in the 2007 Witch Creek Fire is accused of leveraging fake money from a non-existent settlement to obtain various loans, according to U.S. Attorney Laura Duffy.
Douglas Tumlinson, 40, and Deborah Tumlinson, 43, were arraigned on ten fraud-related charges Thursday in federal court.
Duffy says the scheme began after the Tumlinsons lost their home and joined a class-action lawsuit against San Diego Gas & Electric to recoup their losses.
A 2008 California Public Utilities Commission report found SDG&E and Cox Communications were responsible for starting the three destructive wildfires, including the Witch Creek Fire, that burned in October 2007.
While the Tumlinsons did not receive a settlement from the utility, the indictment says the couple claimed that they did to get a loan from funding company U.S. Claims, promising to use the settlement funds as collateral.
According to prosecutors, the Tumlinsons used that money to launder more than $500,000 to purchase a new Valley Center house.
They then got a $250,000 home equity loan on that house by making “material misrepresentations” on a loan application to mortgage broker Seaside Funding, Inc. in Carlsbad, the indictment alleges.
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Seaside Funding says they failed to repay that loan, and the U.S. Claims later sued the couple for not making payments.
The U.S. Attorney also accuses the couple of intentionally failing to list the outstanding loan from U.S. Claims on three separate bankruptcy petitions.
Deborah has been charged with conspiracy, wire fraud, two counts of mail fraud, bank fraud, false statement on a loan application, money laundering and two counts of bankruptcy fraud.
Douglas faces charges of conspiracy, two counts of mail fraud, bank fraud, false statement on a loan application, money laundering and two counts of bankruptcy fraud.
Both will next appear in court for a motion hearing on Nov. 14.
The Witch Creek Fire, the largest of the 2007 wildfires and second largest in California history, destroyed and damaged thousands of homes and killed two people.
