Filed 5/20/13 P. v. Heard CA4/1

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COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

THE PEOPLE,

Plaintiff and Respondent,

v.

JEREMY HEARD,

Defendant and Appellant.

 D060921, D061687

 (Super. Ct. No. SCD221605)

CONSOLIDATED APPEALS from a judgment of the Superior Court of

San Diego County, Louis R. Hanoian, Judge. Affirmed as modified with directions.

Rex Williams, under appointment by the Court of Appeal, for Defendant and 

Appellant. [Appointed.]

Kamala D. Harris, Attorney General, Dane R. Gillette, Chief Assistant Attorney 

General, Julie L. Garland, Assistant Attorney General, Melissa Mandel and Scott C. 

Taylor, Deputy Attorneys General for Plaintiff and Respondent.

Jeremy Heard appeals from a judgment convicting him of numerous counts of 

prohibited practice by a mortgage foreclosure consultant and forgery arising from his 
2

operation of a company that purported to assist homeowners whose residences were in 

foreclosure. He argues the prohibited practice counts (based on his acquisition of an 

interest in the residences) must be reversed because (1) the statute of limitations had 

expired for these counts, and (2) the prosecution did not establish that the residences were 

still in foreclosure at the time he acquired an interest in them. He also argues the forgery 

counts must be reversed because (1) the evidence does not support that the charged 

misconduct constituted forgery, and (2) the trial court failed to instruct on aiding and 

abetting principles. Further, he challenges the trial court's award of victim restitution on 

the basis that one of the victims did not suffer economic loss. We reject his contentions 

of reversible error.

The Attorney General concedes, and we agree, that the minute order and abstract 

of judgment incorrectly refer to a parole revocation restitution fine that was unauthorized 

and not imposed by the court. Accordingly, we modify the minute order to strike the 

reference to this fine, and instruct the superior court to prepare an amended abstract of 

judgment reflecting this change.

As so modified, the judgment is affirmed.1

FACTUAL AND PROCEDURAL BACKGROUND

In the early 2000's, defendant formed a company called Good Samaritan Society 

(GSS or Good Samaritan) with a partner, James Cloud. Cloud, a real estate salesperson, 

 

1 Defendant has also filed a petition for writ of habeas corpus, which we have 

considered with the appeal. In an order filed separately from this opinion, we deny the 

habeas petition.
3

had worked with defendant in the real estate industry since 1988. According to Cloud, 

GSS was formed to help people whose residences were in foreclosure. The plan was to 

get residences out of foreclosure; place ownership of the residences in a trust account for 

three years; allow the homeowners time to rebuild and establish their credit; and then 

permit the homeowners to obtain a loan and reacquire their ownership of their home. To 

qualify for GSS's services, the residences had to be in foreclosure and have some equity 

value. To build a customer base, Cloud and defendant purchased a foreclosure list and 

mailed postcards advertising their services to homeowners on the list. The charges in the 

current case were based on transactions between defendant and seven homeowners who 

contracted with GSS in 2004 and 2005.

At trial, the prosecution's witnesses included Cloud, the homeowner/victims who 

contracted with GSS, and several "straw buyers" who were hired by defendant to 

participate in the transactions. The transactions were generally structured as follows.2 

The homeowners entered into a trust agreement with GSS and signed a grant deed 

transferring title to the residence to GSS. GSS then sold the property to a straw buyer 

who obtained a loan to buy the residence. After the straw buyer's loan was finalized, the 

straw buyer deeded the property back to GSS. To obtain the loan, the straw buyer 

submitted a residential purchase agreement and loan application to the bank indicating 

that he or she was buying the property from GSS. The straw buyer's loan was used to pay 

 

2 There were some differences in the way some of the transactions were structured, 

but for purposes of resolving the issues on appeal we need not specify the variations.
4

off the homeowner's loan, and the portion of the straw buyer's loan derived from the 

equity in the home was disbursed through escrow to GSS as the seller.

The straw buyer's name remained on the loan even after the straw buyer 

transferred ownership of the property back to GSS. The straw buyers received $10,000 

from GSS for their participation. The homeowner continued residing in the home, made 

monthly payments to GSS, and GSS in turn paid the monthly mortgage on the loan 

obtained by the straw buyer. Under the terms of a beneficiary agreement created with the 

trust agreement, GSS (or an affiliated company owned by defendant) was entitled to a 

percentage of the equity in the home upon the termination of the trust agreement.

Defendant used three GSS employees, and the father of a GSS employee, to act as 

straw buyers. According to the straw buyers, defendant made the decisions for GSS's 

operations and told them how to fill out the documents, including the residential purchase 

agreements and loan applications. The straw buyers were not experienced in real estate 

and they simply complied with defendant's directions.

To ensure that the straw buyers would qualify for the purchase loans, defendant 

had them engage in numerous fabrications on the loan applications, including falsely 

stating that they were going to occupy the residences; creating "dummy" corporations and 

stating they worked for these corporations; inflating their incomes; listing assets that they 

did not have; and falsely stating they had no business relationship with the seller (GSS). 

Defendant also gave money to the straw buyers to place in their bank accounts to show 

that they had sufficient assets, which the straw buyers gave back to defendant after the 

loan closed.
5

To sell GSS's services to interested homeowners, defendant met with them at their 

homes or in his office. Defendant told the homeowners that he could save the home from 

foreclosure by putting it into a trust. He explained that the trust, operated by Good 

Samaritan, was designed to keep residences safe for homeowners who had poor credit 

and could not access the equity in the home until the homeowners could improve their 

credit, refinance the property, and buy it back from the trust. He told the homeowners 

that they needed to sign a deed giving the house to him or GSS so that he or another 

buyer could get a loan on the home to pay off the homeowner's loan. He assured the 

homeowners that they would still own the home, and the home would be deeded back to 

them once they reestablished their credit and could refinance the property. When 

homeowners asked defendant why they had to sign a rental agreement if they were still 

the owners, defendant said it was part of the trust arrangement.

The homeowners, who were not experienced in real estate, testified that they 

trusted defendant and thought he was placing their home in a trust that would save the 

home for them. Defendant told them that even though they signed the grant deed, they 

retained ownership of the home though the placement of the property in the trust. 

Further, defendant explained to the homeowners that Good Samaritan's services were 

designed to use the equity in the homes to help the homeowner, and also to help other 

homeowners who needed assistance, and for this reason the company was called Good 

Samaritan.

In 2006 and 2007, problems began emerging in the loan payment arrangements. 

For various reasons, the homeowners stopped sending payments to GSS and/or GSS 
6

stopped sending payments to the bank. For most of the homeowners, the loan went into 

default, and the bank ultimately foreclosed on the home or defendant evicted the

homeowner from the home. In June 2006, Cloud, who had become embroiled in a 

financial dispute with defendant and had started to question whether defendant was 

helping people, wrote a letter to the district attorney's office describing GSS's practices. 

Also in 2006 and 2007, some of the homeowners contacted the authorities or retained 

attorneys, and one of the straw buyers contacted the FBI.

After an investigation by the authorities, defendant was charged with six counts of 

a prohibited practice by a foreclosure consultant based on his acquisition of an interest in 

properties in foreclosure (Civ. Code, § 2945.4, subd. (e)) and seven counts of forgery 

(Pen. Code, § 470, subd. (d)) based on the fabricated home purchase loan applications.3 

The prohibited practice counts were based on the transactions with six of the 

homeowners.4 The forgery counts were based on transactions with five of the 

homeowners whose transactions involved defendant's use of straw buyers.5

Defendant represented himself at trial. After hearing the evidence, the jury 

convicted him as charged. Counsel was appointed for purposes of sentencing, and 

 

3 Subsequent unspecified statutory references are to the Penal Code.

4 The prosecutor did not file a prohibited practice count for the transaction involving 

the seventh residence because it was not owner-occupied as required by the statutory 

scheme. (Civ. Code, §§ 2945.4, subd. (e), 2945.1, subd. (f), 1695.1.)

5 For the two homeowner transactions for which no forgery charges were filed, GSS 

sold the home to defendant rather than to a straw buyer hired by defendant.
7

defendant received an eight-year eight-month sentence (four years eight months to be 

served in the county jail and the remaining four years to be served on supervised 

community release).

DISCUSSION

I. Challenges to Prohibited Practice Counts

A. Statute of Limitations

1. Application of Four-Years-After-Discovery Statute of Limitations

Defendant argues that when the prosecution against him was commenced on

July 20, 2009 (his arraignment date), the statute of limitations had expired for the counts 

based on a prohibited practice by a mortgage consultant (Civ. Code, § 2945.4). Under 

sections 800 and 801, prosecution of an offense that is punishable by imprisonment for 

less than eight years (as here) must be commenced within three years after commission of 

the offense.6 Section 801.5 and section 803, subdivision (c), extend the statute of 

limitations to four years and allow for a discovery tolling period if the offense involves 

an element of fraud or breach of a fiduciary obligation.7 The trial court instructed the 

jury to resolve the statute of limitations issue under the four-years-after-discovery statute.

 

6 The prohibited practices offense is punishable by a sentence of 16 months, two 

years, or three years. (§ 1170, subd. (h); Civ. Code, § 2945.7.)

7 Section 801.5 states: "Notwithstanding Section 801 or any other provision of law, 

prosecution for any offense described in subdivision (c) of Section 803 shall be 

commenced within four years after discovery of the commission of the offense, or within 

four years after the completion of the offense, whichever is later." As we shall discuss, 

section 803, subdivision (c) describes an offense "a material element of which is fraud or 

breach of a fiduciary obligation . . . ."
8

Because the charged prohibited practice offenses were committed in 2004 and 

2005, the commencement of the prosecution in 2009 was untimely if the three-year 

statute of limitations applied. Defendant asserts the three-year statute of limitations 

applied because the prohibited practice of the acquisition of an interest in a residence in 

foreclosure does not include an element of fraud or breach of fiduciary obligation within 

the meaning of section 803, subdivision (c). We disagree.

Section 803 states in relevant part: "(a) Except as provided in this section, a 

limitation of time prescribed in this chapter is not tolled or extended for any reason. 

[¶] . . . (c) A limitation of time prescribed in this chapter does not commence to run until 

the discovery of an offense described in this subdivision. This subdivision applies to an 

offense punishable by imprisonment . . . , a material element of which is fraud or breach 

of a fiduciary obligation . . . ." (Italics added.)

Appellate courts (including this court) have concluded that section 803,

subdivision (c) is applicable if an offense has the prevention of fraud or fiduciary breach 

as its "core purpose," even if fraud or fiduciary breach is not strictly an element of the 

offense. (People v. Guevara (2004) 121 Cal.App.4th 17, 25-26 [filing a false nomination 

paper governed by section 803, subdivision (c)]; People v. Bell (1996) 45 Cal.App.4th 

1030, 1061 [this court's decision holding that offense of filing false or forged documents 

is governed by section 803, subdivision (c)].) Defendant argues this interpretation is 

contrary to the statute's plain language because "material element" can only mean an 

element of the offense that the prosecution must prove. We are not persuaded.
9

When interpreting a statute, our goal is to ascertain and effectuate legislative 

intent. (People v. Price (2007) 155 Cal.App.4th 987, 991.) We construe the words of the 

statute based on their ordinary and usual meaning and in the context of the statute as a 

whole. (Ibid.)

" 'Material element' " can be defined in its narrow, technical sense to mean an 

essential element that the prosecution must prove to establish the offense. (See State v. 

Reynolds (Or.App. 2002) 51 P.3d 684, 685-686.) However, it can also be defined in its 

broader, nontechnical sense to mean an important aspect of the offense. (See MerriamWebster's Collegiate Dictionary (10th ed. 2002) pp. 715, 372 ["material" means "having 

real importance or great consequences"; "element" means "a constituent part"].) The 

latter interpretation is not contrary to the plain language of the statute; rather, it is merely 

based on everyday usage rather than the technical definition of the term.

We agree with the holdings in Guevara and Bell, and conclude the Legislature 

intended the term "material element" to be interpreted based on its nontechnical usage. 

Generally, the delayed discovery rule is designed to relieve " 'the harshness [of barring 

prosecution] . . . where it is manifestly unjust to deprive plaintiffs of a cause of action 

before they are aware that they have been injured.' " (April Enterprises, Inc. v. KTTV

(1983) 147 Cal.App.3d 805, 826.) Such injustice can arise when the defendant engages 

in a fraudulent act or a breach of a fiduciary obligation that prevents the plaintiff from 

being aware of the misconduct or dissuades the plaintiff from investigating the possibility 

of misconduct. (See id. at p. 827.) This unfairness can occur regardless of whether the 

fraud or fiduciary breach is an actual element of the offense, or whether prevention of 
10

fraud or fiduciary breach is the underlying purpose of the statutory enactment. Given the 

ameliorative purpose of section 803, subdivision (c)'s delayed discovery provision, it 

makes sense that the Legislature intended the phrase "material element" to be interpreted 

based on its broader, ordinary usage so as to apply the tolling provision to offenses that 

target fraud and breach of fiduciary obligations even if these matters are not actual 

elements of the offense.

As an alternative argument, defendant posits that the prohibited practice offense of 

acquiring an interest in property in foreclosure (Civ. Code, § 2945.4, subd. (e)), does not 

have a core purpose of protecting against fraud or breach of a fiduciary obligation. He 

notes that the offenses in Guevara and Bell involved falsification of documents, whereas 

no such falsification is needed to acquire an interest in the homeowner's property. Again, 

we disagree because it is clear that the prevention of fraud and breach of a fiduciary 

obligation underlies the statutory scheme governing mortgage foreclosure consultants, 

including the provision prohibiting acquisition of an interest in the property.

In the introductory provisions of the statute regulating mortgage foreclosure 

consultants, the Legislature explicitly sets forth its intent to prevent fraud and unfair 

dealing, stating: "[H]omeowners whose residences are in foreclosure are subject to fraud, 

deception, harassment, and unfair dealing by foreclosure consultants . . . . [¶] . . . [¶] . . .

The intent and purposes of this article are . . . [¶] . . . to safeguard the public against 

deceit and financial hardship; . . . to prohibit representations that tend to mislead; and to 

encourage fair dealing in the rendition of foreclosure services." (Civ. Code, § 2945, 

subds. (a), (c)(1).) To this end, the Legislature imposed a lengthy list of obligations on a 
11

foreclosure consultant who contracts with a homeowner whose home is in foreclosure, 

including, for example, the duty to provide a written contract fully disclosing the exact 

nature of the consultant's services; to notify the homeowner in "14-point boldface type" 

that the consultant cannot ask the homeowner to sign any deed; to notify the homeowner 

in "10-point boldface type" of the right to cancel the transaction within five business 

days; not to receive any compensation until after the services are fully performed; not to 

take any security to secure payment of compensation; not to acquire an interest in the 

residence in foreclosure; and not to take any power of attorney from the homeowner. 

(Civ. Code, §§ 2945.3, 2945.4.)

A fiduciary obligation arises when a person " 'knowingly undertake[s] to act on 

behalf and for the benefit of another, or . . . enter[s] into a relationship which imposes 

that undertaking as a matter of law.' " (City of Hope National Medical Center v. 

Genentech, Inc. (2008) 43 Cal.4th 375, 386.) A foreclosure consultant who contracts 

with a homeowner whose property is facing foreclosure has undertaken an obligation to 

act for the benefit of the homeowner and is subject to strict statutory oversight. As such, 

a foreclosure consultant falls into the category of persons who owe fiduciary obligations 

to his or her clients. (See, e.g., George Ball Pacific, Inc. v. Coldwell Banker & Co.

(1981) 117 Cal.App.3d 248, 256 [real estate broker owes fiduciary duties to client]; 

Apollo Capital Fund LLC. v. Roth Capital Partners, LLC (2007) 158 Cal.App.4th 226, 

245 [stockbroker who advises on investment decisions owes fiduciary duty].) And, by 

acquiring an interest in the homeowner's property, the foreclosure consultant has violated 
12

one of the statutorily-defined fiduciary obligations. It is clear that this prohibited practice 

offense has at its core the prevention of a breach of fiduciary obligation.

We conclude the four-years-after-discovery provision applies to the prohibited 

practice counts. 

2. Substantial Evidence of Delayed Discovery

Even applying the four-years-from-discovery statute of limitations, defendant 

asserts the evidence does not support the jury's finding that the discovery of the 

prohibited practice offenses occurred on or after July 20, 2005, so as to make the July 20, 

2009 commencement of the prosecution timely. He contends the homeowners discovered 

or should have discovered the offenses when they signed the deeds transferring the 

properties to GSS, which occurred in 2004 and January 2005.

An offense is discovered when either the victim or law enforcement learns of facts 

which, when investigated with reasonable diligence, would make the person aware a 

crime had occurred. (People v. Wong (2010) 186 Cal.App.4th 1433, 1445.) The crucial 

determination is whether the victim or the authorities had actual notice of circumstances 

sufficient to make them suspicious of fraud or breach of a fiduciary obligation leading 

them to make inquiries that might have revealed the misconduct. (Ibid.) However, when 

there is a fiduciary relationship between a defendant and a victim, "facts which ordinarily 

require investigation may not incite suspicion . . . ." (Hobbs v. Bateman Eichler, Hill 

Richards, Inc. (1985) 164 Cal.App.3d 174, 201.) In this circumstance, "the duty to 

investigate may arise later because the [victim] is entitled to rely upon the assumption 

that his fiduciary is acting on his behalf." (Id. at p. 202.)
13

The prosecutor must prove that the prosecution is timely by a preponderance of 

the evidence. (People v. Wong, supra, 186 Cal.App.4th at p. 1444.) On appeal, we 

review the record in the light most favorable to the judgment and draw all reasonable 

inferences that the jury could draw from the evidence. (Ibid.)

The record supports that when the homeowners signed the deeds transferring title 

to their residences in 2004 and early 2005, they thought they were transferring their home 

to a trust which would safeguard the property on their behalf, and hence they were not 

aware of facts giving rise to a suspicion that there had been a prohibited transfer to a 

foreclosure consultant. By contracting to help the homeowners save their homes from 

foreclosure, defendant assumed the fiduciary obligations defined in the Civil Code for 

foreclosure consultants. The homeowners consistently testified that although they signed 

a deed transferring the property to GSS, defendant told them that under the trust 

arrangement the home still belonged to them and it would be transferred back to them 

when they could improve their credit and obtain refinancing. Given defendant's status as 

a foreclosure consultant subject to statutorily-specified duties of disclosure and fair 

dealing, the jury could reasonably consider that the homeowners were entitled to rely on 

defendant's expertise and the truth of his representations when he described the 

transaction as effectively retaining their ownership interests in the property 

notwithstanding the execution of the deeds.

Because defendant led the homeowners to believe that under the terms of the 

transfer he did not own their homes, but rather the trust owned the home for the benefit of 

the homeowner, the jury could reasonably find that when the homeowners signed the 
14

grant deeds in 2004 and early 2005 they were unaware of facts triggering a duty to 

investigate the possibility of a prohibited transfer of interest to a foreclosure consultant. 

Thus, the jury was not required to find that the offenses were discovered, or should have 

been discovered, prior to July 2005 so as to make the July 2009 commencement of the 

prosecution untimely.

B. Substantial Evidence of Residence in Foreclosure

With respect to the prohibited practice counts, defendant argues there was 

insufficient evidence to support the statutory requirement that the homeowners' 

residences were in foreclosure based on outstanding recorded notices of default at the 

time he acquired the interests in their properties. He contends that although the 

prosecution presented evidence that notices of default were recorded at some point before 

he acquired the interests, it did not present evidence that they were still outstanding when 

he acquired the interests.

Civil Code section 2945.4, subdivision (e) makes it unlawful for a foreclosure 

consultant to "[a]cquire any interest in a residence in foreclosure from an owner with 

whom the foreclosure consultant has contracted." A residence in foreclosure is defined 

as "residential real property consisting of one- to four-family dwelling units, one of 

which the owner occupies as his or her principal place of residence, and against which 

there is an outstanding notice of default, recorded pursuant to [section 2920 et seq.]." 

(Civ. Code, §§ 1695.1, italics added, 2945.1, subd. (f).)

In reviewing a challenge to the sufficiency of the evidence, we consider the entire 

record and draw all reasonable inferences in favor of the judgment to determine whether 
15

a reasonable trier of fact could find the elements of the offense beyond a reasonable 

doubt. (People v. Young (2005) 34 Cal.4th 1149, 1175.) The same standard applies 

when the prosecution relies primarily on circumstantial evidence. (Ibid.) "An appellate 

court must accept logical inferences that the jury might have drawn from the 

circumstantial evidence." (People v. Maury (2003) 30 Cal.4th 342, 396.) To carry its 

burden of proof, the prosecution is not required to "call all witnesses or introduce all 

exhibits or documents referred to in the testimony or suggested by the evidence." 

(People v. Simms (1970) 10 Cal.App.3d 299, 313.) "Unless it is clearly shown that 'on no 

hypothesis whatever is there sufficient substantial evidence to support the verdict' the 

conviction will not be reversed." (People v. Dejourney (2011) 192 Cal.App.4th 1091, 

1114.)

At trial, the prosecution submitted into evidence notices of default for each of the 

homeowners involved in the prohibited practice counts. Each notice of default was 

recorded prior to the time defendant acquired the interest in the property. Also, the 

homeowners testified that they contacted defendant and agreed to the trust transaction 

because they were behind in their mortgage payments and/or their homes were in 

foreclosure and defendant told them he could save their homes from foreclosure.

To illustrate, the evidence included the following.

(1) For homeowner Kathy Barnes, the prosecution submitted a notice of default 

recorded on January 7, 2004, and a trust agreement and deed for the GSS transaction 

signed by Barnes on February 3, 2004. Barnes testified that she missed three mortgage 

payments in late 2003; she met with defendant in December 2003 and January 2004 to 
16

discuss what she could do in the event of foreclosure; and defendant provided money to 

get her home out of foreclosure.

(2) For homeowner Leotha Britt, the evidence showed a July 21, 2003 recorded 

notice of default, and a September 21 and 22, 2004 signed trust agreement and deed, 

respectively. Britt testified that in 2004 she fell behind on her mortgage payments "to the 

point of foreclosure"; defendant told her he would be able to save her home from the 

foreclosure; Britt signed the deed because she was desperate and "trying to save [her] 

home"; and she filed for bankruptcy to stop the foreclosure because the house was going 

to be sold through foreclosure "within a couple of days[.]"

(3) For homeowner Ruta Tavale, the evidence showed a September 8, 2004 

recorded notice of default, and an October 13 and 20, 2004 signed trust agreement and 

deed, respectively. Tavale testified that in 2004 she was falling behind on her mortgage 

payments; she received notices from the bank about foreclosure; defendant told her he 

could stop the foreclosure; and she entered into the transaction to get out of foreclosure.

(4) For homeowner Ominae Aiono, the evidence showed a January 30, 2002 

recorded notice of default, and a January 7 and 11, 2005 signed trust agreement and deed, 

respectively. Aiono testified that he had trouble making his mortgage payments in the 

early 2000's; by the time he met with defendant he was about $12,000 behind in his 

$1,900 monthly payment; he told defendant about his "foreclosure situation"; and 

defendant said GSS could get him out of foreclosure.

(5) For homeowner Larry Bridges, the evidence showed a November 30, 2004 

recorded notice of default, and a January 31, 2005 signed trust agreement and deed. 
17

Bridges testified that he was three months behind on his mortgage and the home started 

going into foreclosure in the summer; he contacted defendant in the fall; and defendant 

said he could give him a loan to help him catch up with his mortgage and he would pay 

defendant instead of a bank.8

(6) For homeowner Andrew Bulinski, the evidence showed an August 2, 2004 

recorded notice of default, and a January 6, 2005 signed trust agreement and deed. 

Bulinski testified that he began falling behind in his mortgage payments and received 

notices from his bank about defaulting on the loan; he contacted the bank and was told 

they could not help him; he "started panicking" and contacted defendant in early 2005; 

defendant told him he could save his home; and when Bulinski signed the documents 

provided by defendant Bulinski was "desperate."

The documents showing that notices of default had been recorded, combined with 

the homeowners' testimony reflecting that they were trying to save their homes from 

foreclosure when they contacted defendant, provides substantial evidence to support the 

jury's finding that the default notices were still outstanding when defendant acquired the 

interests in the properties.

To support his challenge to the sufficiency of the evidence, defendant notes that 

the prosecution could have presented evidence indicating that a records search had been 

conducted and that no notices of rescission of the notices of default had been recorded at 

 

8 Bridges testified that the foreclosure process started in the summer of 2005 and his 

initial contact with defendant occurred in the fall of 2005, whereas the relevant 

documents show the time periods he referenced were in 2004.
18

the time he acquired the interests in the homes. The absence of this evidence does not 

defeat the support for the findings that there were outstanding notices of default. As 

stated, the prosecution is not required to present all evidence that could support the 

alleged charges. On appeal, our inquiry is whether there is substantial evidence 

supporting the jury's finding that the element was established beyond a reasonable doubt. 

This standard is met here.9

II. Challenges to Forgery Counts

A. Substantial Evidence of Misconduct Constituting Forgery

Defendant argues the record does not support that the charged acts constituted 

forgery. He asserts the prosecution's theory was that he committed forgery by directing 

the loan applicants to inflate income and assets on the loan applications; forgery requires 

a false writing that purports to be that of another or something that it is not; the loan 

applications were signed by the applicants and were what they purported to be; and the 

mere inclusion of false information contained in a document does not constitute forgery.

The offense of forgery is committed when the defendant, with the intent to 

defraud, falsely makes or passes, as true and genuine, a writing that, if genuine, creates 

some legal right or obligation. (§ 470, subd. (d); People v. Gaul-Alexander (1995) 32 

Cal.App.4th 735, 741-742.) However, when a document is what it purports to be, the 

inclusion of false statements within the instrument may constitute false pretenses, but it 

 

9 In the habeas petition considered with this appeal, we conclude defendant has not 

set forth a prima facie case for relief based on his submission of notices of rescission of 

the notices of default for three homeowners.
19

does not constitute forgery. (2 Witkin, Cal. Criminal Law: Crimes Against Property (4th 

ed. 2012) § 194, pp. 244-245.) "[F]orgery directly implicates the writing itself, not the 

oral or implied misstatement about the writing." (Id. at p. 245) To constitute forgery 

based on the creation or use of a fraudulent document, the "instrument must fraudulently 

purport to be what it is not." (People v. Bendit (1896) 111 Cal. 274, 277.) " 'The term 

falsely, as applied to making or altering a writing in order to make it forgery, has 

reference not to the contents or tenor of the writing, or to the fact stated in the writing, 

because a writing containing a true statement may be forged or counterfeited as well as 

any other, but it implies that the paper or writing is false, not genuine, fictitious, not a 

true writing, without regard to the truth or falsehood of the statement it contains --a 

writing which is the counterfeit of something which is or has been a genuine writing, or 

one which purports to be a genuine writing or instrument when it is not.' " (Id. at p. 279, 

italics added.) That is, "[t]hough a forgery, like false pretenses, requires a lie, it must be 

a lie about the document itself:[] the lie must relate to the genuineness of the document." 

(LaFave, Substantive Criminal Law (2d ed. 2013) § 19.7, subd. (j)(5), p. 138, italics 

added, fn. omitted.)

The jury was instructed that to convict defendant of forgery the defendant must 

have "falsely made a residential loan application" or "passed or used a false residential 

loan application." The evidence showed that defendant caused the submittal of home 

purchase loan applications (and accompanying documentation) to the banks purporting to 

be applications from persons who were seeking loans to purchase the homes, whereas in 

fact the persons identified in the loan applications were not purchasing the homes and 
20

were not applying for loans for a home purchase transaction.10 Rather, the persons 

identified on the home purchase loan applications were hired by defendant to pose as 

buyers.11 Although the straw buyers may have filled out the loan applications, they did 

so at defendant's direction and thus the creation and use of the documents could properly 

be attributed to defendant.

In short, defendant caused documents to be submitted to the banks that purported 

to be genuine home purchase loan applications that were not home purchase loan 

applications at all because there was no real buyer and no home actually being sold to a 

buyer. The home purchase loan documents did not merely contain false statements about 

such matters as the buyer's income and assets; rather, the documents themselves were 

fake representations of a nonexistent transaction. Thus, defendant created and used a 

document that purported to be a genuine home purchase loan application that was not in 

fact a genuine document because a home buyer and a home purchase transaction did not 

exist. This factual scenario supported the forgery counts.

Defendant also argues the loan applications were not subject to the forgery statute 

because they did not create a legal duty on the part of the bank to approve the loan 

applications. The forgery offense applies to fabricated documents that will damage the 

legal rights, usually money or property, of a person who acts upon the document as 

 

10 In addition to the loan applications themselves, the banks also received the 

residential purchase agreements between the straw buyer and GSS and, for some 

transactions, copies of fake documents showing corporate stock ownership. 

11 See footnote 5, ante.
21

genuine. (People v. Gaul-Alexander, supra, 32 Cal.App.4th at p. 742; People v. Vincent

(1993) 19 Cal.App.4th 696, 700; People v. McKenna (1938) 11 Cal.2d 327, 332 

["Whether the forged instrument . . . , if genuine, would create a legal liability, is 

immaterial; the test is whether upon its face it will have the effect of defrauding one who 

acts upon it as genuine."].) Although the bank was not required to approve the loan 

application, when it did so it was acting upon the document as a genuine home purchase 

loan application. The bank's right not to extend loans for nonexistent transactions was 

prejudiced by the fabricated document. There was no error in applying the forgery 

statute to defendant's conduct of creating or using the fabricated home purchase loan 

applications.

B. Failure To Instruct on Aiding and Abetting for Forgery

Defendant contends the prosecutor relied on aiding and abetting principles for the 

forgery counts and hence the court erred in failing to sua sponte instruct the jury on 

aiding and abetting.

A trial court must sua sponte instruct on general principles of law that are 

commonly connected to the facts adduced at trial and that are necessary for the jury's 

understanding of the case. (People v. Young, supra, 34 Cal.4th at p. 1200.) The court 

must instruct on every theory of the case supported by substantial evidence. (Ibid.) The 

perpetrator of a crime is the person whose culpability is premised on his or her own 

commission of acts that constitute the crime. (See People v. McCoy (2001) 25 Cal.4th 

1111, 1117.) An aider and abettor of a crime is a person whose culpability is premised 

on his or her assistance or encouragement of the perpetrator's acts. (See ibid.) To 
22

establish culpability based on aiding and abetting, the defendant must have had 

knowledge of the perpetrator's unlawful purpose, intended to commit or encourage the 

offense, and by act or advice aided or encouraged the commission of the offense. 

(People v. Williams (1997) 16 Cal.4th 635, 676.)

When the evidence can support culpability based on aiding and abetting, the jury 

should be instructed on the intent necessary to establish guilt on this theory. (See People 

v. Williams, supra, 16 Cal.4th at p. 676.) However, instructions on aiding and abetting 

are not required where the defendant was not tried as an aider and abettor and there was 

no substantial evidence to support the theory. (People v. Young, supra, 34 Cal.4th at

p. 1201.) Evidence is substantial if a reasonable jury could find it persuasive. (Id. at

p. 1200.)

Contrary to defendant's contention, the record shows that defendant was tried as 

the actual perpetrator of the forgery, not as an aider and abettor. The prosecution's theory 

was that defendant was the actual perpetrator because he masterminded the fraudulent 

home purchase loan application scheme and instructed the straw buyers on how to fill out 

the documents. Although the straw buyers may have been defendant's accomplices 

because they helped defendant, there was no claim by the prosecutor that defendant could 

be culpable as a facilitator of the straw buyers even if he was not the direct perpetrator.12

 

12 The jury was instructed that the straw buyers were accomplices and were 

instructed on the corroboration requirement for accomplice testimony. (See CALCRIM 

No. 335.) The prosecutor referred to the accomplice corroboration requirement in closing 

arguments, but did not suggest that defendant's liability could be premised on aiding and 

abetting the straw buyers.
23

Defendant contends he could not be prosecuted as the direct perpetrator because 

he did not personally produce the loan applications but directed others to do so. The 

contention is unavailing. The evidence showed that defendant in effect committed the 

acts of fabricating the loan applications by directing his subordinates to prepare the 

documents per his instructions. In this context, defendant used agents to commit acts for 

him, which can make him culpable as the perpetrator. (People v. Waxman (1952) 114 

Cal.App.2d 399, 407-408; see 17 Cal.Jur. 3d (2010) Criminal Law: Core Aspects, § 128, 

pp. 224-225.) This is not a case where the defendant merely assisted or encouraged other 

persons to commit the acts underlying the criminal offense; rather, defendant himself 

generated and controlled the acts through the use of subordinates who obeyed his 

directions.

Because defendant was not tried on an aiding and abetting theory and there was no 

substantial evidence to support that he was merely a facilitator and not an actual 

perpetrator, the trial court was not required to sua sponte instruct on aiding and abetting 

principles.

Alternatively, even assuming arguendo the trial court should have instructed on 

aiding and abetting, the error was harmless beyond a reasonable doubt. (People v. 

Kurtenbach (2012) 204 Cal.App.4th 1264, 1274.) The jury was instructed that to find 

defendant guilty of forgery, the prosecution had to prove that defendant made or used a 

false residential loan application; that he knew the application was false; and that he 

intended that the application be accepted as genuine and intended to defraud. (See 

CALCRIM Nos. 1904, 1905.) Thus, the instructions required the jury to find defendant 
24

committed the acts and had the requisite state of mind for forgery, and the jury was not 

led to believe that it could find him guilty based merely on an accomplice's acts or state 

of mind.

Defendant argues that because the jury was not instructed on aiding and abetting, 

it did not know that the straw buyers who actually filled out the loan applications had to 

have acted with intent to defraud in order to find defendant guilty as an aider and abettor. 

This contention is based on a misunderstanding of aider and abettor principles. Aiding 

and abetting culpability may be based on the combined acts of the perpetrator and aider 

and abettor, but the culpability of each turns on his or her own individual mens rea. 

(People v. McCoy, supra, 25 Cal.4th at p. 1120.) The fact that the direct perpetrator may 

have a lesser (or no) culpability does not exonerate an aider and abettor who acts with the 

state of mind required for the charged offense. (Id. at p. 1121.)

There was no reversible error arising from the failure to instruct on aiding and 

abetting.

III. Restitution

A. Restitution Awarded to Wilson

After holding a restitution hearing, the trial court ordered defendant to pay 

restitution to the homeowners based on the amount of equity they had in their homes at 

the time of defendant's misconduct. Defendant asserts there was no evidence to support a 

finding of compensable loss by one of the victims (Michael Wilson) because Wilson's 

father was the owner of the home, and Wilson was a victim associated with the forgery, 

but not the prohibited practice, counts. The Attorney General contends this challenge is 
25

forfeited on appeal because although defendant challenged the amount of the award to 

Wilson, he did not raise the issue of Wilson's lack of ownership of the home.

To avoid a forfeiture on appeal, the defendant must generally raise restitution 

objections to the trial court. (People v. Gonzalez (2003) 31 Cal.4th 745, 755.) In any 

event, even assuming arguendo the issue is not forfeited, the record supports the award to 

Wilson.

The trial court is required to award restitution to "a victim [who] has suffered 

economic loss as a result of the defendant's conduct . . . ." (§ 1202.4, subd. (f).) A victim 

is a person who is the object of a crime. (People v. Crow (1993) 6 Cal.4th 952, 957.) On 

appeal, we review the trial court's restitution order for abuse of discretion. (People v. 

Gemelli (2008) 161 Cal.App.4th 1539, 1542.) No abuse of discretion will be found 

where there is a rational and factual basis for the restitution order. (See ibid.)

The prosecution did not file a prohibited practice count for the transaction 

associated with Wilson because the residence was not owner-occupied as required by the 

prohibited practices statutory scheme. (See fn. 4, ante.) The forgery counts were based 

on the fabricated loan applications, and defendant argues that the bank (not Wilson) was 

the direct victim of the forgery and Wilson has not suffered an economic loss based on 

the forgery.

Although Wilson did not directly suffer loss from the forgery, he nevertheless was 

a direct victim of, and suffered economic loss from, defendant's overall trust agreement 

scheme. Wilson testified that his father originally purchased the home and title to the 

home was in his father's name, but Wilson made the monthly mortgage payments and 
26

lived there with his family. Wilson met with defendant and decided to use GSS's 

services, and thereafter brought his father to a meeting with defendant to sign the 

necessary documentation. Wilson explained that his father let him decide whether to sign 

up for GSS services, stating: "[M]y dad left it in my purview to do. At the time I was 

messing up my father's credit. I wanted to get my dad's name off of the credit. So this 

was like [a] last shot. We'll do this, get his name out of it, and he won't have anything to 

do with the house anymore."

Drawing all inferences in favor of the court's ruling, the evidence showed that 

Wilson paid the mortgage, used the home as his permanent residence, and had an 

understanding with his father that the house effectively belonged to him. This provided a 

reasonable basis for a finding that he suffered economic loss from defendant's 

misconduct. Further, because Wilson lived in and was financially responsible for the 

residence and met with defendant to secure GSS's services, he was the object of 

defendant's misconduct. Under these circumstances, he can reasonably be characterized 

as a victim of defendant's misconduct even though he was not the title owner and his 

transaction did not correlate with the prohibited practice counts. The record supports the 

trial court's inclusion of Wilson in the victim restitution award.

B. Correction of Minute Order and Abstract of Judgment

The parties agree, as do we, that the minute order and abstract of judgment should 

be corrected to remove a parole revocation restitution fine (§ 1202.45) that was not 

imposed by the court and that is not authorized given that defendant is serving his 

sentence in local custody and will not be paroled.
27

DISPOSITION

The judgment is modified to remove the parole revocation restitution fine from the 

minute order. As so modified, the judgment is affirmed. The superior court is directed to 

correct the abstract of judgment to remove the parole revocation restitution fine and to 

transmit a corrected abstract of judgment to the local custody officials and to the 

California Department of Corrections and Rehabilitation as necessary.

HALLER, Acting P. J.

WE CONCUR:

MCDONALD, J.

O'ROURKE, J.