Multiple real estate operators and their companies are the target of a lawsuit filed by Arizona’s attorney general on March 12, which alleged an organized fraud scheme that targeted homeowners facing foreclosure. Title companies and law firms that allegedly took part in the fraud were also named in the suit.
Arizona Attorney General Kris Mayes filed his lawsuit in the Maricopa County Superior Court against real estate developers Cameron Jones and Samuel Sutton for allegedly engaging in equity-stripping practices in violation of Arizona’s Consumer Fraud Act. The lawsuit alleged that Jones, through his company Gazelle Investors, and Sutton, through his company Magnum Financial, led a network of businesses and individuals engaged in an organized real estate scam.
The lawsuit seeks civil penalties of $10,000 for each instance of consumer fraud, the dissolution of companies used as fronts for the fraud, and a permanent ban on the defendants engaging in real estate transactions in Arizona.
Mayes’ lawsuit alleged that Jones and Sutton targeted homeowners in foreclosure by tracking foreclosure notices on county recorder websites. Once foreclosure notices were posted, individuals known as “door knockers” were recruited by the defendants and sent to approach homeowners while posing as foreclosure relief specialists or representatives of charitable organizations, including a fabricated entity called “Arizona’s Helping Hands,” to gain homeowners’ trust and make them believe they were dealing with a legitimate charity.
After entering the victims’ homes, the defendants and their associates used aggressive methods and misleading contracts to steal homeowners’ equity. These contracts, often illegal in Arizona, helped the fraudsters buy properties at low prices while keeping rights to cancel deals and resell homes for profit. In some cases, fake bankruptcy and probate filings delayed foreclosure sales, keeping control of homes without homeowners knowing.
The lawsuit also named title companies and law firms that allegedly helped this fraud by processing sales despite clear warning signs, including Magnus Title Agency LLC and American Title Services Agency LLC. These companies notarized documents when homeowners lost money, allowed quick resales through shell companies to hide the fraud, and sued victims to force sales and evict defrauded homeowners, according to the complaint.
“For far too long, these bad actors have preyed on Arizonans in distress, stealing the hard-earned equity in their homes through deception and fraud,” Mayes said in a press release announcing the lawsuit. “These homeowners didn’t just lose their homes — they lost their best chance to rebuild their lives.”
Given that the scheme orchestrated by Jones and Sutton involved the intricate cooperation of multiple malicious entities, Mayes made it clear that each participant would be made to face consequences.
“This scheme relied on an entire ecosystem of supposedly legitimate businesses to put a veneer of legality on blatant consumer fraud,” Mayes said in a press release. “Title companies and law firms knew what they were doing, but they kept going because this scam generated millions of dollars — and they wanted their share.
“If you are victimizing homeowners, we will stop you and recover what you stole,” he continued. “If your business is helping these scammers, we will file suit against you seeking triple the amount you earned from the scam. The days of ripping off distressed Arizona homeowners are over — if you keep doing it, I will see you in court.”
Lastly, Mayes and his office issued a warning to homeowners facing foreclosure to be abundantly cautious regarding offers to save their homes. Arizonans who believe they have been targeted by an equity-stripping scheme are encouraged to report it to the Arizona Attorney General’s Office at www.azag.gov/consumer or by calling (602) 542-5763.