Archives For Mortgage Fraud

Leigh Fiske, 52, formerly of Tampa, Florida, was indicted and charged with two counts of bank fraud. If convicted, he faces a maximum penalty of 30 years in federal prison on each count.

According to the indictment, Fiske submitted two fraudulent financial instruments to the servicer and the bank trustee of a mortgage that he had used to finance the purchase of property in Tampa, Florida in 2005. The fraudulent instruments and accompanying documentation directed the financial institutions, both of which had received funds from the Treasury Department’s Troubled Asset Relief Program, to apply the face value of the instruments to his outstanding mortgage debt in separate attempts to extinguish that obligation. In truth, neither instrument had or conveyed anything of monetary value. The intended loss of the scheme was over $650,000.

In March 2016, Fiske was indicted in a separate fraud case for a scheme in which he allegedly funneled monies obtained from counterfeit or altered business checks through a trust account that he had created for a shell company he controlled. That case is pending trial.

United States Attorney A. Lee Bentley, III announced the indictment. The case was investigated by the Office of the Special Inspector General for the Troubled Asset Relief Program, the Federal Bureau of Investigation, and the Office of the Comptroller of the Currency. It will be prosecuted by Assistant United States Attorney Eric K. Gerard.

Jason Martin, 36, Orange County, California, pleaded guilty to mortgage fraud conspiracy involving bank and wire fraud. He faces a maximum penalty of 30 years’ imprisonment. A sentencing date has not yet been set.

According to court documents, in 2005, entities controlled by co-conspirators entered into a contract to purchase The Arbors, an apartment complex in Hillsborough County, Florida. The new owners then engaged in a plan to convert the complex from rental apartments to condominium units. The co-conspirators engaged in a scheme to defraud mortgage lenders by developing a set of incentives, such as rental supplements, payment of homeowner’s association fees, and kickbacks to the buyers after closing. These buyer incentives were deliberately hidden from the lenders.

Martin’s role in the conspiracy, as a mortgage broker, involved originating mortgages through Envision Lending and Set 2 Go Loans. The loan applications submitted by Martin contained material misrepresentations, including false occupancy and inflated borrower income and asset information. These loan applications were submitted to FDIC insured institutions and other mortgage lenders.  Additionally, through his company HUMAR Investments, Martin and his co-conspirator provided borrowers with cash to close without disclosing the payments to the lenders.

United States Attorney A. Lee Bentley, III announced the plea.  The case was investigated by the Federal Bureau of Investigation and the Federal Housing Finance Agency Office of Inspector General. It is being prosecuted by Special Assistant United States Attorney Chris Poor and Assistant United States Attorney Jay Hoffer.

Arthur Samuels, 41, Mattapan, Massachusetts, a former bank manager was sentenced to one year and one day in prison, two years of supervised release, and was ordered to pay restitution of $2,229,492 in connection with a multi-year, multi-property mortgage fraud scheme in Dorchester, Massachussetts.  In 2012, Samuels pleaded guilty to four counts of wire fraud and one count of bank fraud.

From 2007 to 2008, Samuels engaged in a scheme with Michael David Scott, and others, to purchase multi-family residences and then sell individual condominium units in the buildings to straw buyers.  Scott, a former realtor and developer, arranged to purchase multi-family residences and then sold individual condominium units to straw buyers recruited as investors by him, Samuels, and co-conspirators, Jerold Fowler and Thursa Raetz.  Scott and his co-conspirators recruited straw buyers with promises that they would not have to make down payments, pay any funds at closing, or be responsible for mortgage payments, and would share in profits when the units were resold.  In order to obtain mortgage loans for some of the straw buyers, Samuels created bogus bank deposits falsely representing that the straw buyers’ accounts had large balances with his bank.  Scott then submitted mortgage loan applications that falsely represented key information, such as the buyers’ income, personal assets, down payment, and intention to reside in the condominiums.  The mortgage lenders, (nine national mortgage companies and one local bank) were led to believe that the straw buyers had made substantial down payments and paid substantial sums at closing.  In addition, Samuels also recruited a straw buyer for the purchase of two condominiums, and acted as a straw buyer himself on three properties.

In November 2015, Scott was sentenced to 135 months in prison, and Fowler and Raetz were sentenced to two years in prison.

Samuels was sentenced by U.S. District Court Senior Judge Mark L. Wolf .  United States Attorney Carmen M. Ortiz; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today.  The case was prosecuted by Assistant U.S. Attorneys Victor A. Wild and Ryan M. DiSantis of Ortiz’s Criminal Division.

Michael Gerard Camphor, 60, of Baltimore, Maryland, pleaded guilty to charges arising from the fraudulent purchase of four properties in Baltimore, Maryland, using fraudulent loan documentation and straw purchasers, resulting in losses of over $736,000.

According to Camphor’s plea agreement and other court documents, since 2002, co-conspirator Andreas E. Tamaris, 45, Bel Air, Maryland, purchased, renovated, and then resold distressed row houses in Baltimore City, primarily in the Highlandtown neighborhood.  Camphor had worked as a real estate agent for a company and also operated a real estate consulting business called Ron Gerard LLC, a/k/a Ron Gerard & Associates. Continue Reading…

John D. Harrison, Jr., 53, Greenwood, South Carolina, Henry A. Dorn, 63, Greenwood, South Carolina, Kevin Dempsey, 45, Greenwood, South Carolina, and C. Jody Hazel, 42,Greenwood, South Carolina, pled guilty in federal court in Greenville, South Carolina, to conspiracy to commit bank fraud.  United States District Judge Bruce Howe Hendricks, of Charleston accepted the pleas and will impose sentence after she has reviewed the presentence report which will be prepared by the U.S. Probation Office.

Evidence presented at the change of plea hearing established that Harrison was a real estate developer who developed high end residential properties in North Carolina, South Carolina and Georgia. Dorn, Dempsey and Hazel were accountants for the accounting firm that prepared Harrison’s financial statements and tax returns. Dorn primarily serviced Harrison’s account.  Harrison obtained loans from numerous banks and individuals to fund his real estate developments. A review of Harrison’s financial statements that were provided to banks from August 31, 2000 until May 31, 2008, indicated that Harrison significantly understated his total debt—that is, the financial statements contained false information and this false information was material to the lenders and was meant to influence the actions of the lenders.  Dorn prepared these financial statements for Harrison. In essence, Dorn kept two sets of books for Harrison: one with false numbers and one with accurate numbers.

Harrison also entered into Accommodation Borrowing Agreements with Dorn, Dempsey and Hazel in which these three men served as straw purchasers for Harrison.  The agreements allow for Harrison to sell the property to Dorn, Dempsey and Hazel and continue to develop and sell the properties. The interest payments would be paid by Harrison and the loans would be paid off when Harrison sold the property. The profit or loss would belong to Harrison and Harrison would pay a fee to Dorn, Dempsey or Hazel totaling 3% of the loan amount. The agreements were not disclosed to the banks until after the loans went past due.

In addition to the undisclosed agreements, Dorn, Dempsey and Hazel all understated their debt when applying for their respective real estate loans—that is, the financial statements contained false information.  Law enforcement estimates that federally insured banks lost in excess of $10 million in scheme and artifice to defraud.

United States Attorney Bill Nettles stated the maximum penalty the Defendants can receive is a fine of $1,000,000 and/or imprisonment for 30 years, plus a special assessment of $100.

The case was announced by United States Attorney Bill Nettles and investigated by agents of the Federal Bureau of Investigation.  Assistant United States Attorney Bill Watkins of the Greenville office handled the case.

Daniel C. Bomar, 36, Ocean Springs, Mississippi, James B. Wright, 55, Ocean Springs, Mississippi, and Brett T. Immel, 35, Chicago,  Illinois, were indicted by a federal grand jury on April 14, 2016, and charged with conspiracy to commit bank fraud and conspiracy to commit money laundering in the Eastern District of Texas.

According to the indictment, from 2010 to 2012, the defendants are alleged to have conspired to defraud and obtain money from Prime Lending, a mortgage lending company in Dallas, and from Federal Savings Bank, a mortgage lending company in Overland Park, Kansas.  Both companies are insured by the Federal Deposit Insurance Corporation (FDIC).   Continue Reading…

Dionysius Fiumano, also known as “D,” 43, Irvine, California, was found guilty in Manhattan federal court of orchestrating a massive mortgage modification scheme through which he and his co-conspirators defrauded more than 30,000 American homeowners out of a total of approximately $31 million.  Fiumano was convicted of one count of conspiracy to commit wire fraud and one count of wire fraud, each of which carries a statutory maximum sentence of 20 years in prison.

According to the Indictment other filings in Manhattan federal court and the evidence presented at trial:

Fiumano was the general manager of sales at Vortex Financial Management, Inc., a/k/a Professional Marketing Group, a/k/a Professional Legal Network (“PMG”), an Irvine, California, company that offered purported “mortgage modification” services, that is, assistance persuading the homeowner’s lender to agree to a modification to the terms of the homeowner’s mortgage to make it more affordable.  In that capacity, Fiumano oversaw PMG’s sales staff of approximately 65 telemarketers and managers. Continue Reading…

Avalon, Betts-Gaston, 47, Naperville, Illinois, a disbarred Illinois lawyer, was sentenced to more than four years in federal prison for her role in a mortgage fraud scheme that bilked lenders and vulnerable homeowners out of more than $725,000.  Betts-Gaston contrived fraudulent real estate transactions to defraud homeowners and financial institutions.  She and a co-defendant, Dimona Ross, arranged for the submission of materially false information on mortgage loan documents in four Cook County, Illinois, real estate transactions worth more than $725,000.

A federal jury last year convicted Betts-Gaston on two counts of wire fraud.  In addition to the 57-month prison term, U.S. District Judge Charles R. Norgle  ordered Betts-Gaston to pay restitution in the amount of $239,550.48. Continue Reading…

Gary Hughes, 36, San Diego, California, pled guilty to one count of mortgage fraud conspiracy involving bank fraud. He faces a maximum penalty of 30 years’ imprisonment.

According to the plea agreement and court proceedings, in 2005, entities controlled by co-conspirators entered into a contract to purchase The Arbors, an apartment complex in Hillsborough County, Florida. The new owners of The Arbors then engaged in a plan to convert the complex from rental to condominium units. Continue Reading…

Sergio Roman Barrientos, 62, Poway, California, was indicted by a federal grand jury in a six-count superseding indictment that charged both Barrientos and Zalathiel Aguila, 42, Fairfield, California.

According to the indictment, Barrientos, Aguila, and Omar Anabo, 53, Vallejo, California, engaged in a foreclosure rescue fraud scheme that began in September 2004 and continued to February 2008. Barrientos and Aguila are charged with conspiracy to commit and the commission of wire fraud affecting a financial institution, bank fraud, and conspiracy to make and making false statements on loan applications. On January 15, 2016, Anobo pleaded guilty to conspiring to make false statements on loan applications (case number 2:16-cr-001 GEB). He is scheduled for sentencing on November 4, 2016. Continue Reading…