Judge Orders Escrow Agent to Pay Restitution to San Juan

A woman who embezzled $2,055 from a city program for low-income homeowners must pay it back, a federal judge said Monday morning.

U.S. District Judge Otis D. Wright II ordered Belinda Exon, a 56-year-old escrow agent who now lives in Phoenix, to pay nearly $4 million to two dozen California cities. In addition to paying restitution, she will serve a 37-month prison sentence beginning June 3.

When she pleaded guilty last May, Exon admitted that she embezzled $3.9 million that was being held in escrow by her former company, Rehab Financial Services Inc. Exon's now defunct company would administer money reserved to bring low-income housing in San Juan Capistrano and other California cities up to building codes, City News Service reports.

According to city staffers in San Juan, several years ago a housing consultant, JDK consulting, used Rehab Financial for San Juan's Owner Occupied Rehabilitation Program. Under the program, the city offers zero-percent interest deferred payment loans of up to $20,000 to eligible low-income homeowners to make health and safety repairs to mobile homes.

In 2008, the city stopped using JDK consulting and started doing the loan services  in-house. The final loan under the consultant's contract had $2,055 remaining, which the San Juan Capistrano Community Redevelopment Agency covered. When the restitution is made to the city, it will be transferred to the Community Redevelopment Agency, city spokeswoman Kelly Tokarski said.

According to U.S. attorney's office spokesman Thom Mrozek, Judge Wright said at Monday’s hearing that Exon’s conduct “had a real and tangible effect on a population that we, as a society, are attempting to reach out to and help. People will be living in less habitable dwellings—even dangerous dwellings.”

Exon used much of the embezzled funds to finance the purchase of residential properties and vacant land in the Arizona cities of Phoenix, Maricopa, Kingman, Chandler and Glendale. She also used about a half million dollars to fund start-up landscaping and pool service businesses.

Exon took the money during a six-year period that ended in 2008.