The operator of a predatory “boiler room” network that squeezed millions of dollars out of families already on the brink of foreclosure was sentenced today to ten years in federal prison.
Mohammed Zafaranchi, 43, of California, known to his associates and victims as “Mike,” was taken into custody immediately following the hearing at the U.S. District Court in Seattle.
The sentencing caps a case that exposed a sprawling scheme targeting nearly 1,000 distressed homeowners. According to federal prosecutors, Zafaranchi’s operation didn’t just steal money; it often finalized the financial ruin of his victims.
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“This defendant lined his pockets with some $2.6 million while preying on vulnerable homeowners,” said U.S. Attorney Charles Neil Floyd. “Of more than 900 victims, many lost their homes to foreclosure, and all were in worse financial shape due to the ‘help’ his company never provided.”
The Scripted Scam
Zafaranchi, who was convicted of twelve federal charges including wire fraud and money laundering following a week-long trial, ran the operation by purchasing lead lists of homeowners who had fallen behind on mortgage payments.
Once the targets were identified, the trap was set. Zafaranchi sent out thousands of mailers weekly, promising a lifeline: a government program that could slash mortgage debt by 30% and drop interest rates to a rock-bottom 2%.
When hopeful homeowners called the number on the mailer, they were routed to call centers where operators worked off a carefully crafted script. To create the illusion of legitimacy, operators were instructed to place callers on hold for a specific amount of time, building suspense while they pretended to consult with legal teams and underwriters.
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The operators would then return to the line with “good news,” telling the victims they were among the select few who qualified for the program. There was, however, a catch: a $3,000 legal fee required to “finalize” the deal.
In reality, there were no lawyers or underwriters. The staff consisted of untrained workers who merely scanned financial records and mailed basic forms to banks—paperwork that did nothing to stop the foreclosures.
Obstruction and Aftermath
The scheme began to unravel on March 29, 2018, when FBI agents raided one of the call centers in Everett, Washington.
Upon learning of the search warrant, Zafaranchi attempted a cover-up. He instructed employees at his California offices to strip computers and evidence from the premises. That same night, he deleted records from three email accounts essential to the operation—actions that led to his conviction for obstruction of justice.
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Prosecutors had requested a 12-year sentence, noting the sheer volume of victims.
“Stealing $3,000 from families, retirees, or other vulnerable individuals who are desperately fighting to keep their homes is appalling,” prosecutors wrote in a filing to the court. They noted that Zafaranchi victimized an average of nearly one person a day for three years.
U.S. District Judge John C. Coughenour cited the “severe hardship” inflicted on the victims when handing down the decade-long sentence. In addition to prison time, Zafaranchi will face three years of supervised release. A hearing to determine restitution amounts is scheduled for a later date.
Zafaranchi’s co-conspirators, Mark Lezama and Josh Herrera, have also pleaded guilty to their roles in the fraud. They are scheduled for sentencing in early 2026.
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