Federal arrest warrants were issued for five people, including a Cape Coral, Florida, police officer in connection with an alleged investment property scheme in South Florida. Those named in the criminal complaint were:
Ronald D. Luczak
Lisa Luczak (wife of Ronald Luczak)
Nelson Alex Gonzalo, Cape Coral Police Officer
Patricia Martin, escrow officer
Sandra Mainardi, mortgage loan officer
According to the criminal complaint, in September 2005, shortly after his June 20, 2005 release from 48-months of federal incarceration in connection with his role in a stock fraud that he conducted while employed as a broker in New York and while on supervised release for that crime, Luczak began a scheme to purchase properties in Cape Coral, Florida through his companies, Cape Coral Equity and Development Group, Inc. and Cape Coral Equity and Development Group, LLC – both established under his wife’s name, Lisa Luczak.
Luczak would find properties for sale, primarily in the Southwestern section of Cape Coral that were on canals, ‘for sale by owner’ and of a certain size and decent value. Luczak explained to Vincent Milotta, an investor with Luczak, that his plan was to find investors with a credit score over 650 and use the investor’s SSN to obtain financing in an amount greater than the home’s purchase price. The excess proceeds would be placed in an escrow account and used to make the mortgage payments. Luczak would promise investors that he would sell the property after six months and split the profits, minus expenses, with the investors. Investors were also promised payment on closing, usually $5,000.
Investors were primarily from South Florida or New Jersey. Many South Florida investors were located by Pinnacle Property Development, Inc., Delray Beach, a corporation registered to David P. Hoffman and Jeremie Leonard.
The complaint states that the investigation established the fraud scheme. The investors would enter into a mortgage obligation, using their good credit to obtain the mortgage. The buyers would receive an incentive payment of up to $5,000, with the promise of fifty percent of the profit from the sale of the home, which would be sold within six months. The mortgages would be obtained based upon an inflated real estate value. The buyers would obtain the loans, utilizing the credit check, but did not fill out applications for the loans, the loan packages contained false income amounts, allowing investors to qualify for higher amounts. The complaint states that none of the properties had been sold despite Luczak’s six month promise and three of the properties were foreclosed due to Luczak not making the loan payments.
Sandy Mainardi, acing through Monarch Mortgage in New Jersey, worked with Luczak in obtaining and processing the mortgage loans and received significant payments through Luczak’s accounts for her part in the scheme, according to the complaint. As part of the scheme to defraud the lenders, Luczak makes the mortgage payments until the mortgages are sold to another lender, thereby keeping him and his mortgage broker in good standing.
Luczak received approximately $5M during the year period of the scheme’s operation and obtained 42 mortgages totaling over $14M through New Century. Mortgages were also obtained through five other lenders.
Luczak’s “assignment fees” were received through title company escrow accounts, initially USA Land Title through Patricia Martin until February 2006 and then through Edison Title Services, 1323 Lafayette St, Suite D, Cape Coral Florida. The money laundering allegations also identify funds as being deposited from Select Title Guaranty Agency Group.
Gonzalo is alleged to have received $32,000 from Luczak’s accounts in addition to his share of $99,390.53 through Atlas Real Estate commissions on the fraudulent loans. According to the complaint, witnesses saw Gonzalo, who located properties for Luczak, wrote contracts for Cape Coral Equity and otherwise assisted Luczak; receive undisclosed amounts of money in cash
You all see what is going on here. This is exactly what has occurred to me and three others that I know about and the crooks are still on the loose doing these schemes. They introduce themselves as savvy real estate investors using your credit report and they never make a payment on the mortgage note because their goal is the foreclosure of the property so that they can pick it up cheap. I have reported this to authorities in South Florida and the report will be aired within the next month or so and written in the Miami Herald. Luczak’s operation is peanuts compared to what we have in hand with my case but yet no one is doing anything even when we have solid evidence (emails, sound bites admitting to the act, showing up at my attorney’s office admitting to the act and proof that the properties have been flipped on and on again for inflated values. You all will see one of the biggest mortgage fraud rings ever soon but yet Rachel Dollar and others including the feds, economic crime bureau, attorney general’s office etc still state that no one reports these acts. Well , I have been trying to get some support for almost a year and no one wants to even mess with these dangerous people. We know the feds are on this via their sars database but when will they bring these people to justice and give my life and others lives back? Shame on the feds but soon they will see this aired on national tv and it will be printed in local papers in South Florida and then I will say ” I told you so”.
Yes, Mr. Oral has it about right. As a real estate practitioner I tried to make the local FBI office aware of several suspicious transactions. Their reply was that they do not have time or resources. Great! Now we can expect another federal department devoted to financial oversight (or do we already have one?) draining resources and assets from those that are already in place “DHS” bring anything to mind. So, we just sit back and watch this play out.
Certainly there are many areas of concern when it comes to prosecuting mortgage fraud criminals. In fairness to the FBI, as we have been told here in the state of Utah the criminal threshold must breach the $1 million mark before an active investigation is pursued. Our biggest complaint with that has been that criminal enterprises are operating under various business entity names and thus further elude law enforcement and their $1 million dollar threshold as it would appear that one company might only have $200K in loans but collectively the enterprise could have several million in fraud loans.
Although the penalty is not as great the fastest way we have seen here in Utah – a state that ranks second in the nation for mortgage fraud is to have the County DA pursue charges.
Hope this helps and please contact us if you have further questions. Our nonprofit would like to keep abreast of your situation.
Try contacting the Florida Department of Law Enforcement or the Florida Bureau of Finance Regulation. I would note that the US attorney in Florida just announced a $10 million dollar mortgage fraud indictment of 11 suspects.
Sandra takes after her brother, Russell Mainardi, who operated as an unlicensed mortgage broker for years out of NJ, at numerous locations, and for a time Sandra worked for him. He pleaded guilty to fraud & tax evasion & cut a deal to only serve 10 months in the federal pen on the tax evasion charge. She should have used his attorney!
Not sure who Justice Served is, but he is misrepresenting the facts. Russell had licensing. After 7 years they could prove nothing other than he had some bad employees including family. All charges were dropped and he plead to Tax Evasion over some taxes that were never filed on a defunct business, one of four he owned. Before making comments, one should know the facts. These facts can be backed up! He is a great guy and one of the best business minds I know. I had the pleasure of working with him.
I have been following these blogs for quite sometime. To my amazement, I find it appauling that facts can be so distorted. I have known Mr. M for many years. I went thru this with him and his family who were continually harassed until he promised to plead out as there was nothing other than the wrongful trust of key people within his organization who actually committed the crimes. Eventually, the names will come out. Unlike what you read, all his licensing was in place. The indictment was dropped, but you don’t read about that. He was a successful person and we all know the problems with success. You create enemies. Be careful people! You can easily be next if you fight for your God given rights!