Wilshire State Bank Named in RICO Lawsuit.

Online, July 13, 2012 (Newswire.com) - Wilshire State Bank, a subsidiary of Wilshire Bancorp Inc., (NASDAQ: WIBC) has been named as a defendant in a civil lawsuit under the Racketeering Influenced and Corrupt Organizations (RICO) Act.

The complaint (CV12-05244 PA AGRx) filed in the United States District Court, Central District of California alleges that defendants Wilshire State Bank, Pearson Affiliated Inc., Keller Williams Commercial Realty, Dornin Investment Group et al, used the U.S. Postal system, the internet and telephone as agents of fear, terrorizing tenants of a Wilshire State Bank lender-foreclosed property to force them to move.

The suit alleges that under Wilshire State Bank's "evict and sell" business model, when Wilshire State Bank became the owner of 701 South Mariposa, a foreclosed property in Los Angeles, Wilshire State Bank chose to evict the tenants residing at the property in order to enhance the property's sales prospects and to facilitate the sale of the foreclosed property.

Also named in the lawsuit is realtor Yitzy Pearson of Pearson Affiliated, John Safi of SAFCO Capital Group, realtor Seth Polen of Keller Williams Commercial Realty, Chris Dornin of Dornin Investment Group and Roman Celusta of 709 South Mariposa Inc.

The suit alleges that the plaintiff's mailbox became a source of fear and intimidation as the defendants misused the U.S. Postal System to pepper the plaintiff with written notices, demanding that the plaintiff accept a relocation offer or face imminent eviction.

Continuous intimidation, threats of eviction, threats of homelessness and financial injury were allegedly directed at the plaintiff to induce the plaintiff to move. The alleged scheme which involved 1) Wilshire State Bank, a leading FDIC-regulated banking institution and 2) Pearson Affiliated Inc., a full-service property management company and 3) SAFCO Capital Group, a real estate management firm and 4) Keller Williams Realty, a commercial real estate firm and 5) Dornin Investment Group, a commercial real estate investment firm has allegedly defrauded the plaintiff's neighbors of their residential dwellings.

The RICO suit alleges that each defendant was integral to the enterprise's objective which was to rid the lender's foreclosed property of rent-controlled tenants by any means necessary.

According to the lawsuit, 75% of the building's original tenants have been forcibly removed since August of 2011. The defendants have allegedly used such tactics as illegal rent increases, illegal seizure of tenant property, meritless evictions and deceptive "cash for keys" offers that paid a mere fraction of the amount mandated by the Los Angeles Rent Stabilization Ordinance (LARSO). This pattern was aimed at driving out a protected class of economically-disadvantaged and disabled residents and sharply increasing rents for newcomers.

According to the lawsuit, the proceeds from the defendants' racketeering activities allowed them to re-market and re-sell a multi-million dollar property profitably and allowed the defendants to derive unlawful proceeds from their unlawful activities.