Condo Conversion Fraud Scheme Indicted in Illinois

Rachel Dollar —  July 2, 2015 — Leave a comment

Vince Manglardi, 59, real estate developer, Long Grove, Illinois; Theodore “TJ” Wojtas, Jr., 43, real estate developer, Glenview, Illinois; David W. Belconis, 56, attorney who owned and operated Classic Title, Inc., Long Grove, Illinois; Nunzio L. Greico, 63, Palatine, Illinois, who was formerly an employee of the developers; Walter Vali, also known as “Wally Mohammad” and “Mohammad Valimohammad,” 62, former mortgage loan originator, who did business as Sunshine Funding, Inc., Mundelein, Illinois; and Karin L. Ganswer, 62, former licensed real estate salesperson, Palatine, Illinois were indicted by an federal grand jury and charged with mail and wire fraud in connection with the marketing and sale of condominiums at a 50-acre development in Palatine, Illinois known as “The Woods at Countryside.”  They are alleged to have participated in a mortgage fraud scheme which caused more than $16 million in losses to banks, mortgage lenders, Fannie Mae, and Freddie Mac.

According to the indictment, in 2006, Manglardi and Wojtas purchased the Woods at Countryside, a 50-acre development in Palatine, Illinois, containing 719 apartments. They converted the apartments to condominiums and sold them to individual buyers. Mangalardi and Wojtas, according to the indictment, managed the affairs of the Woods through a variety of corporate shells, including American Dream, Inc.; Countryside Real Estate Development, LLC; ESP 411 Holdings, LLC; Palatine Leasing Services Group, Inc.; Renaissance Residential of Countryside, LLC; Renaissance Residential Property Management, Inc.; and Steal-A-Condo, LLC.

The indictment accuses Manglardi and Wojtas of, among other things, using an assortment of advertising methods and sales pitches—on air, online, in writing, and at live presentations—to falsely promote the purchase of condos at the Woods as a means to financial independence and wealth, enticing prospective condo buyers with substantial, unsustainable financial incentives, including down payment refunds and up to three years’ worth of mortgage payments, maintenance costs, and property tax payments.

The indictment alleges that Manglardi, Wojtas, and their co-schemers colluded with each other to induce people to purchase condos at the Woods based on false promises and assurances.  The indictment further alleges that the defendants colluded with one another and with others to misrepresent and conceal material facts from banks and mortgage lenders in order to fraudulently induce such banks and mortgage lenders to approve non-conforming loans to condo buyers, thereby exposing numerous lenders and Fannie Mae and Freddie Mac to millions of dollars in losses.

The indictment also seeks the forfeiture of $16 million.  It charges various acts of wire fraud, mail fraud, and false statements to financial institutions.  Each count of the indictment carries a maximum term of imprisonment of 30 years and a maximum fine of $1,000,000.  If a defendant is convicted, the court must impose a reasonable sentence pursuant to the federal criminal code and the advisory sentencing guidelines.

The criminal charges were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Barry McLaughlin, Special Agent-in-Charge of the Midwest Regional Office of the Federal Housing Finance Agency’s Office of Inspector General; and Robert J. Holley, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

The government is being represented by Assistant United States Attorney Brian Havey.

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Rachel Dollar

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