Six individuals were indicted on allegations that they conspired to defraud financial institutions by using straw buyers to purchase luxury homes in Paradise Valley, North Scottsdale, Arcadia, Fountain Hills and other upscale areas in the Phoenix, Arizona area. The defendants include:
Cleothus Lefty Jackson, Jason Mark Chrzanowski, Shawn Kyle Thomas Brooks, Dean Saunders, Vincent James Vendittelli, Marc Bordner.
One of the primary motivations for the scam was large cash back payments upon the purchase of the houses. However, even larger illicit profits were obtained upon the sale of a house from one controlled straw buyer to another. The scheme resulted in the foreclosure of more than 100 houses and losses of more than $50 million.
One of the six indicted conspirators, Vincent Vendittelli, was a loan officer at Spectrum Financial Group (SFG). Vendittelli handled all of the straw buyers’ loans and presented false information to financial institutions on loan applications which enabled otherwise average people to falsely qualify for multimillion dollar houses. Vendittelli handled more than 100 of these loans.
Another indicted conspirator, Cleothus Jackson, aka Henry Oliver Ford, and four other co-conspirators are alleged to have devised the scheme and recruited the straw buyers. Straw buyers were paid for the purchase of the houses but the lion’s share of illicit profits went to the recruiters, according to the indictment.
All of the properties went into foreclosure and in some cases bank short sales. The resulting decrease in home values caused a ripple effect across the Valley.
The indictment filed in early June 2010, was the result of an ICE investigation.
“These illicit schemes defrauded financial institutions out of millions of dollars,” said Matt Allen, ICE Special Agent in Charge in Arizona. “This investigation provides real insight into how virtually every aspect of some of these transactions was permeated with fraud and why the real estate market in Arizona is in its current condition. ICE is proud to work with the U.S. Attorney’s Office and our other law enforcement partners to hold these individuals accountable for enriching themselves at the expense of our banks, our communities and ultimately all American taxpayers.”