Fraud case moves forward

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A Socorro man facing 30 felony charges — 26 counts of fraud and four counts of embezzlement — attended his change of plea hearing in 7th Judicial District Court on Tuesday, with the result of another plea hearing planned for May.

Joseph Vallejos, former owner of JM Abstract & Title Company, is charged with selling fraudulent title policies to customers. Vallejos was arrested in November 2010 following an investigation by the Socorro Police Department and Public Regulation Commission insurance fraud investigators. He pleaded not guilty in September 2011, but a plea deal has been in the works since early last year.

Randy Chavez, Vallejos’ attorney, explained to district Judge Kevin Sweazea that Vallejos is not yet able to come up with the amount required for the initial phase of restitution to the alleged fraud victims, though part of the plea deal entails restitution. Sweazea interjected restitution was “the most important part” of the plea deal.

Chavez said between $50,000 and $60,000 is needed for the initial restitution amount, but Vallejos has only about $20,000 now.

Chavez said the jewelry confiscated from Vallejos’ residence, which is being held in evidence, could be used to help pay the restitution. He added another title company wants to purchase microfiche and other records from Vallejos, items also in evidence.

Robert Cates, prosecutor with the 7th Judicial District Attorney’s Office, said some funds can be turned over at the next plea hearing, more at sentencing and the final amount can be paid off in installments during the defendant’s probation. Cates said once the whole restitution amount is paid, Vallejos’ probation time could be shortened.

Cates said many of the fraud victims had insurance, and the state is not looking to reimburse insurance companies with Vallejos’ restitution payments.

The judge asked if Vallejos will be ready for another plea hearing in May, and Chavez thought that was realistic.

Two other plea hearings were held before Tuesday: on Sept. 18, 2012, and Nov. 20, 2012. Cates said during an interview Tuesday afternoon those 2012 hearings concluded with similar results as Tuesday’s: The court gave Vallejos more time to come up with more money for restitution.

Cates said he can’t give details about the agreement being worked out between the state and Vallejos until Vallejos actually enters a plea. He explained the plea agreement is confidential until it is officially on record with the court, although anything discussed in open court is public record.

Cates said they are working out an agreement whereby Vallejos would make a pool of restitution available to the alleged fraud victims.

“He’s still working on putting that together,” Cates said.

Cates said there are 30 victims in the case, which is not the number of people who allegedly lost money in their dealings with JM Abstract & Title Company, but a sampling to be more manageable in a trial.

He said the state is trying to give Vallejos the time he needs to build the pool of restitution.

“The alternative is to just take it to trial, and that means dragging people here from all over the place,” Cates said. “And maybe run the risk of not getting the kind of restitution we were hoping for.

“It seems like it’s easier when all sides are reaching an agreement voluntarily.”

Cates said if the case is resolved with a plea, that will end the criminal charges pending against Vallejos in the matter — although there may have been hundreds of victims. He said once the criminal case is resolved, other victims could still potentially sue Vallejos in civil court.