FORENSIC AUDIT: Mortgage Accounting & Sale Discrepancies
DATE: December 21, 2025 SUBJECT: Financial Reconciliation of Sheriff’s Sale (August 15, 2025) CASE: FCFCU v. Rice-Velasquez
1. THE CORE DISCREPANCY
Based on a line-by-line audit of Plaintiff’s affidavits vs. the Final Sheriff’s Sale Report, there is an unexplained overcharge/surplus of approximately 9,000.00.
| Category | Plaintiff Claim (8/15) | Defendant Audit | Variance (Overcharge) |
|---|---|---|---|
| Judgment Principal | $220,863.09 | $220,863.09 | $0.00 |
| Interest (Per Diem) | $10,725.27 | $7,384.05 | ($3,341.22) |
| Taxes (Premature) | $7,681.00 | $2,951.94 | ($4,729.06) |
| Attorney Fees | $4,750.00 | $3,000.00 | ($1,750.00) |
| Publication/Misc | $1,094.35 | $284.28 | ($810.07) |
2. KEY REVENUE LEAKS & ERRORS
A. The “Double Interest” Error
- Facts: Plaintiff’s Affidavit (4/29/25) confirmed a first mortgage balance of 23,261.32.
- Per Diem: 4.31 (2nd) = $27.45/day.
- The Math: From 11/19/24 to 8/15/25 (~269 days) × 7,384.05**.
- Discrepancy: Plaintiff charged $10,725.27. This indicates either a retroactive rate hike or a double-counting of interest already applied to statements.
B. Premature Tax Seizure
- Facts: Plaintiff paid the Fall 2025 taxes (due 11/10/25) early on 8/4/25.
- The Issue: The Sheriff’s sale occurred 8/15/25. Charges for taxes not yet due at the time of sale are the responsibility of the new owner (the Bank), not additions to the debtor’s judgment.
- Overcharge: $4,729.06 (the non-delinquent portion).
C. Attorney Fee Inflation
- Facts: Michael Fair’s Affidavit (5/13/25) stated he worked 8 hours + 4 estimated (12 hours total) at 3,000.00**.
- Discrepancy: Plaintiff’s final accounting added **4,750 total, contradicting the sworn hours.
D. Publication Fee Discrepancy
- Facts: Plaintiff claimed $1,094.35 for publication on 7/17/25.
- Evidence: The Sheriff’s own report lists advertising costs at 810.07 difference.
3. PROCEDURAL DEFECTS (BAD FAITH)
- “Unknown Occupant” Lie: Plaintiff filed a Writ of Assistance (10/29/25) claiming occupants were “unknown” and had “refused to vacate.” As a 15-year member/borrower with active contact, the User was “known,” and was never served a notice to vacate prior to the tactical removal.
- Writ Expiration: The Order for Writ (11/06/25) directed a return to the court within 5 days. Plaintiff sat on the order for 33 days, executing it only when convenience suited them (12/09/25), rendering the “emergency” nature of the writ a procedural sham.
- Affidavit Irregularity: The signature on the Arizona notary (Kimberly Flowers) for the “Affiant” contains the phrase “further affiant saith not” but the signature line and pen-strokes suggest a secondary party may have signed for the VP, raising questions of authenticity.
4. IMPACT
These errors aren’t just “rounding differences”—they represent a total failure of Plaintiff’s fiduciary and procedural duty. The Bank essentially “bid” with the User’s own money (excess interest and premature taxes) to ensure a zero-surplus result, effectively stealing equity that should have been returned to the User for displacement mitigation.