Consent Judgment Against Mortgage Loan Originator for Mortgage Fraud Scheme

admin —  June 19, 2009 — Leave a comment

Leo H. Desire, Sr. entered into a Consent Judgment resolving allegations over his role in repeated instances of mortgage fraud related to a Revere, Massachusetts property. Under the terms of the Consent Judgment, entered by Suffolk Superior Court Judge Margaret Hinkle, Desire was permanently prohibited from acting as a mortgage loan broker or originator. In addition, Desire was ordered to pay $240,000 in restitution, disgorging monies he received as a result of the fraudulent transactions. He was also required to pay $60,000 in fees and penalties to the Commonwealth.

On March 30, 2007, the Attorney General’s Office filed the lawsuit against Desire, Primary Mortgage Resource, Inc., and closing attorney Valerie Hanserd. The complaint alleged that together the defendants altered a deed from the Federal Home Loan Mortgage Corporation a.k.a. “Freddie Mac“. Freddie Mac intended to sell the property at 60 Warren Street, Revere, Massachusetts to Desire for $305,000, and prepared a deed to such effect. The complaint alleges that the defendants altered that deed by changing the purchase price of the property from $305,000 to $475,000, and by changing the name of the buyer from Desire to a straw buyer who had no intention of occupying the property or paying the mortgage obligations. The complaint also alleges that the defendants made these changes without Freddie Mac’s knowledge or approval. The complaint further alleges, as with this transaction and a prior transaction involving the same property, that the defendants provided false loan applications with falsified income verifications, and inflated appraisals of the property, which allowed them to obtain mortgage loans for straw buyers in sums greater than the property value supported. Additionally, the defendants allegedly drafted and submitted false HUD Settlement Statements to the lenders and then made and received improper disbursements from the fraudulently obtained mortgage loans.

As previously reported on Mortgage Fraud Blog, The Attorney General’s Office recently entered into a judgment with Valerie Hanserd regarding her alleged involvement in the 60 Warren Street transaction and an alleged foreclosure rescue scheme. A trial against the remaining defendant, Primary Mortgage Resource, Inc., commenced on June 5, 2009. Testimony in the case concluded on Thursday, June 11, 2009. Closing arguments have not yet been scheduled.

The Commonwealth continues to pursue claims against Desire and 17 other defendants regarding their participation in a foreclosure rescue scheme. In that case, the defendants allegedly conspired through their respective roles as mortgage brokers, real estate brokers, closing attorneys and straw buyers to deceive homeowners into selling their homes under the false promise of avoiding foreclosure and maintaining their homes and their homes’ equity. Trial in that lawsuit is scheduled to commence this fall.

Attorney General Martha Coakley made the annoucement. These cases are being handled by Assistant Attorneys General Gillian Feiner and Amber Villa of Attorney General Coakley’s Consumer Protection Division, with the assistance Civil Investigators Nancy Ward and Quinton Dale and Paralegal Yolanda Kruczkowski.

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