6 Charged for Role in Scheme Involving 26 Properties

Allison Tussey —  April 13, 2011 — Leave a comment

A loan officer and five straw buyers/investors were charged in federal court via a criminal information for their roles in a mortgage fraud scheme involving 26 properties throughout the Cleveland, Ohio, area and more than $7.5 million in mortgage loans:

Jeffrey S. Brown, Jr., 30, Cleveland, Ohio, a loan officer;

Rolante Z. Brown, 37, Cleveland, Ohio;

Raymond Fountain II, 34, Bedford Heights, Ohio;

Jickie Hayes, 38, Westlake, Ohio;

Melvin L. Jackson, 31, Cleveland, Ohio; and

Samuel Nwosu, 59, Cleveland, Ohio.

The information charges all of the defendants with one count of conspiracy to commit mail fraud. Additionally, Melvin L. Jackson was charged with one count of bankruptcy fraud.

The charges allege that from March 2004 through June 2006, all six defendants conspired to fraudulently purchase properties in the Cleveland area, securing over $7.5 million in mortgage loans. The information further alleges that as part of the conspiracy, Defendant Jeffrey S. Brown, Jr., a loan officer for Buckeye Lending, completed and submitted fraudulent loan applications in the names of straw buyers (individuals who applied for mortgage loans on a property, but never intend to live in the home) and investors (individuals who purchased the properties with the intention of using them as rental properties.)

The straw buyers/investors included Defendants Rolante Z. Brown, Raymond Fountain II, Jickie Hayes, Melvin L. Jackson and Samuel Nwosu, whose employment, income and assets were falsified in almost every loan application and who concealed the source of the down-payment funds in order to obtain the financing to purchase their properties.

The information alleges that Jeffrey Brown induced the straw buyers/investors to participate by promising they could purchase the properties with no money down, and that they would receive cash back at closing. The properties were purchased at inflated values allowing the defendants to fraudulently obtain the excess funds at closing for personal use, according to the charges.

The defendants’ fraudulent conduct induced Meritage Mortgage Corporation, Finance America, LLC, Master Financial, Security Connections, Michigan Fidelity Acceptance, Long Beach Mortgage Company, Novastar Mortgage, Inc., New Century Mortgage Corporation, First Franklin Financial, Fifth Third Bank and Argent Mortgage Company, LLC to fund the mortgage loans. These victim companies suffered a loss in excess of $2.5 million as a result of the defendants’ scheme.

If convicted, the defendants’ sentences will be determined by the Court after review of factors unique to this case, including the defendants’ prior criminal records, if any, each defendants’ role in the offense, and the characteristics of the violation. In all cases the sentences will not exceed the statutory maximum and in most cases they will be less than the maximum.

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, announced the charges.

“Mortgage fraud remains one of the top priorities of this office because of the devastating economic impact on our community,” Dettelbach said. “We are focusing a significant portion of the office’s resources, along with our law enforcement partners, to find and prosecute the perpetrators of mortgage fraud in Northeast Ohio with a goal of eliminating it.”

This case is being prosecuted by Assistant United States Attorney Mark S. Bennett and Special Assistant United States Attorney Dean P. Wyman, following an investigation by the Cleveland Offices of the United States Postal Inspection Service and the Internal Revenue Service.

An information is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

Be Sociable, Share!

Allison Tussey

Posts Google+

No Comments

Be the first to start the conversation.

Leave a Reply

Text formatting is available via select HTML.

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong> 

*