Woman Sentenced to Prison For Embezzling Nearly $4 Million From Cities Including Seal Beach

The owner of a Huntington Beach financial company accused of embezzling nearly $4 million in federal funding from several cities including Seal Beach was sentenced today to serve 37 months in prison and to pay restitution.

Last year Belinda Exon pled guilty to embezzling funds reserved for safety improvements for low-income homes, according to prosecutors.

In handing down the sentence, U.S. District Judge Otis D. Wright II noted that Exon's conduct did more than just financial harm: it “had a real and tangible effect on a population that we, as a society, are attempting to reach out to and help. People will be living in less habitable dwellings – even dangerous dwellings” as a result of Exon’s embezzlement.

Exon’s now-defunct Rehab Financial held grants and loans in escrow on behalf of municipalities – from September 2002 to October 2008, according to the U.S. Attorney's Office.

The company administered Housing and Urban Development funds slated to bring low-income housing in Seal Beach and San Francisco along with 19 other California cities up to building codes, according to court records.

According to prosecutors, Exon, 56, of Phoenix, Ariz., used the money forproperty in Arizona for herself and her Nevada-based company, CFH PropertiesInc. She also stole money to finance two other companies she owned -- Desert FoothillsLandscaping Inc. and Arizona Pool and Spa Inc.

The low-income housing money she took from the cities also bought her a fourplex, a triplex and a duplex in Phoenix along with several vacant parcels, according to the plea agreement.

According a statement from the U.S. Department of Justice, San Francisco’s Lead and Housing Rehabilitation Programs Manager of the Mayor’s Office that because of the embezzlement, “many low-income residents continue to be forced to live in substandard conditions that threaten their health, most notably children under the age of six who are most susceptible to the effects of lead paint exposure.”

Assistant U.S. Attorney Ranee A. Katzenstein told Wright at a previous hearing that Exon has cooperated in the investigation of the case.

According to the plea agreement, the following cities suffered losses in the scheme:  

• Seal Beach, $481,432
• San Francisco, $1 million
• Pomona, $751,000
• Huntington Park, $478,000
• Westminster, $223,392
• Buena Park, $162,563
• Rosemead, $128,328
• Montebello, $125,000
• Apple Valley, $95,452
• Camarillo, $91,975
• Fullerton, $66,453
• Perris, $66,000
• Bellflower, $59,140
• Calimesa, $42,257
• Santa Cruz, $34,784
• Encinitas, $29,524
• Santa Monica, $26,029
• Hollister, $22,195
• West Covina, $10,000
• Rialto, $8,791
• South Gate, $7,603
• Hemet, $3,000
• San Juan Capistrano, $2,055. 

The City News Service contributed to this report.