A total of 13 defendants have been indicted in Ohio on mortgage fraud offenses involving nearly 13 million dollars in fraudulent loans, 9 of which worked for Argent Mortgage Company.
Denise (O’Brock) Kobus – Argent account manager
Michael Scola – Argent account manager
Angela Pasternak – Argent account manager
Terry Forbes – Argent supervisor
Gerald Steinkuehler – Argent supervisor
Dee Anne Shaw – Argent underwriter
Kirk Porter – Argent underwriter
David Mongriotis – Argent underwriter
Erin Foley-Ottaviano – Argent underwriter
Six of the defendants, including an Argent supervisor and Argent account managers, were indicted on engaging in a pattern of corrupt activity for operating this criminal enterprise. They falsified mortgage loan documents on 100 loans for 100 houses that did not meet Argent‘s standards. Argent was a large subprime lender in Cuyahoga County, Ohio.
The scheme entailed Argent account managers, Michael Scola, Angela Pasternak, and Denise (O’Brock) Kobus, coaching mortgage brokers, such as Dale Adams, Nick Myles, and James Sims, whom have already been charged for falsifying loan applications. In addition, these Argent account managers and Argent underwriter, DeeAnne Shaw, falsely stated that the conditions for approving said loans had been met.
Defendants engaged in the enterprise were involved with buyers or purchasers of residential real estate mainly located in Cuyahoga County and Summit Counties. The loans were secured by a mortgage received by Argent who later sold the note or mortgage/securities to investors. The buyers, with the assistance of mortgage brokers and employees, agents or independent contractors of Argent, submitted signed false and fraudulent loan applications to Argent‘s processing center located in Illinois in order for the buyer to purchase real estate in Cuyahoga or Summit County.
In these various loan applications, the buyers, with the assistance of mortgage brokers and account managers from Argent or other representatives from Argent, misstated one or more of the following: the amount of their assets, their income, the source of or existence of any down payment, the existence of a legitimate seller carryback mortgage, and/or other basic and fundamental financial information regarding their financial condition, in order to gain approval for the loan amounts requested in these applications. The total of the fraudulent loans is nearly $13 million. These loans were used on houses sold by or through Uri Gofman, who was indicted in the largest residential mortgage fraud case in the nation.
The following defendants were indicted on mortgage fraud related offenses including engaging in a pattern of corrupt activity: Michael Scola, Linda Warner, Denise Kobus, Angela Pasternak, Karen Harris, and Gerald Steinkuehler. The following defendants were indicted on mortgage fraud related offenses: James Sims, Terry Forbes, DeeAnne Shaw, Kirk Porter, David Mongriotis, Gerald Spuzzillo, and Erin Foley-Ottaviano.
Appraisers Linda Warner and Gerald Spuzzillo have been indicted on theft charges for falsifying appraisals on real estate deals for Argent and Long Beach Mortgage Company. These appraisers were hired by mortgage brokers and Uri Gofman to appraise properties Uri Gofman was selling. They inflated such appraisals to deceive Argent into believing that the properties were worth more than they actually were.
County Prosecutor Bill Mason and the Cuyahoga County Mortgage Fraud Task Force operating under authorization of Ohio Attorney General Mike DeWine’s Office and Ohio’s Organized Crime Investigations Commission announced the indictment.
Prosecutor Mason said, “The securitization and selling of these fraudulent subprime loans on Wall Street typified the rampant greed of the industry that ultimately led to the financial crisis.”
With funding from the Ohio Attorney General’s Office and the Organized Crime Investigations Commission, the Task Force was formed in December 2007. The Task Force is comprised of federal, state, and local law enforcement agencies. The director of the Task Force is a Sergeant of the Cuyahoga County Sheriff’s Office.