Authorities Claim Fraud may Exceed $20M
Andrew M. Kissel, 45, a real estate developer who builds multi-million dollar homes in Greenwich, Connecticut, was indicted on charges of bank fraud in connection with allegations that he recorded false releases of existing mortgages in order to obtain new financing from banks.
Kissel was released on $1 million bond after an appearance in U.S. District Court in White Plains and was confined to his home in Greenwich and ordered to wear an electronic monitoring device.
In an affidavit filed in connection with the issuance of the arrest warrant, an FBI special agent averred that on July 26, 2004, Kissel obtained a mortgage loan for $1,620,800 from a bank to purchase a 2.24 acre property at 43 Burning Tree Road, Greenwich, Connecticut. On or about February 2, 2005, Kissel filed with the Town Clerk in Greenwich, Connecticut, a false and fraudulent mortgage release, purportedly from the bank, that cleared title to the property. The bank extending the first loan was never actually repaid and the bank did not have an employee by the name of the purported vice-president signing the release. After filing the fraudulent release, the property would have appeared unencumbered in a title search.
The Second Loan: The affidavit further alleges that, in or about January 2005, Kissel began the process of seeking a $4,500,000 construction line of credit from another bank in order to build a residence on the property. By virtue of the fraudulent release, Kissel deceived the new lender into believing the property was unencumbered. The construction loan closed on March 22, 2005 and, as of July 7, 2005, Kissel had drawn approximately $1,559,576.85 on the second loan. On or about April 9, 2005, Kissel filed with the Town Clerk, a false and fraudulent release of the second loan. The second loan had not actually be repaid.
The Third Loan: According to the affidavit, in or about May 2005, Kissel sought a $1M loan from a third lender, once again secured by the 43 Burning Tree Road property, in order to invest in a riding stable in Greenwich. Due to the false lien releases, a title search reflected that the property was unencumbered and the third loan closed on May 23, 2005.
The Fourth Loan: In May 2005, Kissel also sought a $4,525 construction line of credit from a fourth lender in order to build a residence at the 43 Burning Tree Road Property. The title search conducted by the fourth lender showed that the property was unencumbered (the third loan closed the day prior to the title search for the fourth loan and thus the third loan was not reflected.) The fourth loan closed on June 3, 2005 – secured by the property on Burning Tree Road. As of July 7, 2005, Kissel has drawn approximately $2,150,000 on the fourth loan.
When the lender attempted to record the mortgage on the fourth loan, they learned of the existence of the third loan and contacted Kissel. Kissel claimed the third lender had attached the wrong property and thereafter filed a fraudulent release of the third loan.
Andy, How could you do this to your family? After all they have been through??
5/22
Hi- I am in partnership with a large developer who wants to encumber my building with a construction loan. He has offered to me, in writing, a $200k advance from the construction loans 1st draw to pay for his obligation to me. I immediately told him no, that was lender fraud and that every dime from the construction loan must be put back into the construction of the project. He told me I was unsophisticated, and that banks allow draws to be used for other things than the project. I immediately broke off the partnership, along with other things that seemed amiss and now we are in court. At depositions, he stated the same thing about the draws being allowed to be used for other items than the construction and said that he would alert the bank to his intentions, and therefore that was not fraud. Have you ever heard of a bank allowing construction loan monies to be used, after the loan was approved, for anything other than the project? I’ve never heard of that practice and to be truthful, in my quest for education I’ve not heard of any bank that would allow that.