A realty scam, 'spoofing' and a fake FBI agent

Peggy Lowe / The Orange County Register /

SANTA ANA, Calif. — At first, Rebecca Smith was relieved when she got a phone call from an FBI agent.

It was October, just a few months after Smith had spent $30,000 on a real estate investment. The woman who sold her the deal, Karen Hanover, hadn’t come through on any of her promises, and Smith was worried.

Smith noticed the caller ID read “US Gov.” The male voice identified himself as an FBI agent and said he was working on an investigation into Hanover’s dealings. But the agent quickly became angry, scaring Smith.

“I was trying to explain something and he said, ‘Just shut up and answer the questions,’” Smith recalled. “So now I’m shaking.”

The agent demanded the names of other people who had invested with Hanover, people Smith had been talking to about how they, too, hadn’t received anything Hanover had promised. The conversation went from bad to worse.

“He says, ‘You better watch your back.’ He says, ‘I’m going to throw your ass in prison. I’m going to testify against you.’ He says, ‘You’re a psycho. You’re this, you’re that,’ “ Smith said. “Then I got mad.”

She didn’t know it yet, but Smith had been “spoofed” by the very woman the faux FBI agent said he was investigating, federal officials say in court papers.

Hanover, 44, a Seal Beach, Calif., real estate saleswoman, was arrested in February and was indicted later that month. She faces an August trial on charges of impersonating an FBI agent by using spoofing software, an online service that allows a caller to disguise a number and create false outbound numbers on caller ID to fool people.

Federal prosecutors say Hanover used the spoofing service to call Smith and others so she could threaten and intimidate them into staying quiet about her real estate dealings.

The FBI is also investigating whether Hanover bilked dozens of investors of up to $30,000 each with promises that she could teach them how to obtain commercial property with little money and receive full return on the investment, court documents show. Hanover sold online lessons and held large seminars at hotels across the country, billing herself as an entrepreneur, author and commercial real estate expert.

John Early, Hanover’s attorney, declined to comment for this article. Hanover did not respond to phone calls.

Despite the charges, Hanover’s many online promotions — and propensity to videotape her messages for mass appeal — remain on the Internet and have become fodder for several sites where people describe her as a scam artist and share details of her arrest.

After Smith made her investment with Hanover, two months passed without a word.

“Two months after you wired the money into her account — nothing. People were in a frenzy,” Smith said.

Hanover finally called Smith, told her that she was fighting legal problems and promised that they would soon get coffee together.

But another month passed, and Hanover still hadn’t contacted her. Smith reached out to others who had bought into the same program and started commenting on a blog dedicated to exposing Hanover. That’s when she received the call from the faux FBI agent.

After being relieved, then scared, Smith finally became angry at the fake FBI agent’s threats. She called the number back and talked to a true representative who assured her agents don’t act that way. Eventually, she filed a report with an FBI agent.

In an FBI report filed with Hanover’s indictment, an agent reported that none of Hanover’s investors was ever placed in any properties, nor did Hanover honor the money-back guarantee. Hanover also bragged to a former employee about using the spoofing service to fool Smith, according to the agent’s affidavit, and she proved it by using the software to call the former employee with a number from the FBI’s Miami field office.

Hanover’s dealings have been reported to the California Department of Real Estate, which regulates licenses, and it was confirmed in a letter to at least one victim that the agency is investigating her for the commercial property seminars. If any wrongdoing is found, she could face the loss of her license or other disciplinary actions.

If convicted of the federal criminal counts, Hanover faces three years in prison and a fine of up to $250,000.

Smith, who said she’s lost $37,000 to Hanover, is now the clearinghouse of contacts for people who say they have been victimized by Hanover. Several other investors and a former employee contacted by The Orange County Register said they wouldn’t comment on the record because they say Hanover is known for threatening litigation against anyone who crosses her.

Hanover lists a Seal Beach post office box on her real estate license and has been living at a multimillion-dollar, 3,700-square-foot, waterfront property in Naples, the island neighborhood in Long Beach. The house — with four bedrooms, six bathrooms and a 2,000-square-foot flat roof built for parties — is owned by Ben Garizi, 65, of Irvine, Calif., who rented the house to a Hanover friend in November 2008.

Hanover paid the first month’s $6,000 rent, Garizi said, but has refused to pay anything since then. Garizi has tried to evict her several times, but she has made several legal counters, claiming deficiencies in the house, he said. The case is currently tied up in Los Angeles County Superior Court.

Garizi’s financial loss on the home and on another nearby has forced him into foreclosure on both properties. Garizi says Hanover has told him that she wants him to lose the house so she can ultimately buy it at auction. He says she has intimidated him with threats of legal action and has warned him not to come into the house because she owns a gun.

Garizi, who owned a construction company, has filed for bankruptcy and faces foreclosure on his own home in Irvine. He blames it entirely on Hanover.

“I lost my credit. I lost my business. I used my savings for my children’s college. Everything,” he said. “That house was like a baby for me.”

Smith is helping Garizi try to get a loan modification for the home where Hanover lives. They hope to become partners in a business dedicated to buying distressed properties, fixing them and flipping them.