Loan Officers Admit Using Straw Buyers to Defraud Lenders

Allison Tussey —  April 12, 2012 — Leave a comment

Frederick Warren, 38, Miller Place, New York, Dorian Brown, 38, Mount Sinai, New York, and Fritz Bonaventure, 30, Lithonia, Georgia, three mortgage loan officers, each pled guilty for their roles in a $9 million mortgage fraud scheme. The defendants pled guilty before U.S. District Judge Naomi Reice Buchwald.

According to the Indictment previously filed in Manhattan federal court:

Warren, Brown, and Bonaventure, along with nine other individuals, engaged in an illegal scheme to defraud various lending institutions by using fictitious and fraudulent “straw identities” to apply for mortgage loans. Through the scheme, the defendants were able to obtain more than $9 million in mortgage loans for the purchase of dozens of residential properties throughout the New York City metropolitan area and Long Island. Most of these loans quickly went into default. Warren, Brown, and Bonaventure each acted as loan officers who processed the fraudulent mortgage applications.

Warren and Brown each pled guilty (Warren Plea, Brown Plea) to one count of conspiracy to commit wire fraud and bank fraud and one count of wire fraud. They face a maximum sentence of 50 years in prison.

Bonaventure pled guilty to one count of conspiracy to commit wire fraud and bank fraud and faces a maximum sentence of 30 years in prison.

All three defendants will be sentenced by Judge Buchwald: Warren on August 14, 2012, Brown on August 14, 2012, and Bonaventure on September 12, 2012.

Co-defendants Jeffrey Larochelle, Joell Barnett, Foriduzzaman Sarder, Sakat Hossain, and Mikael Huq previously pled guilty in this case. Sarder was sentenced by Judge Buchwald on June 26, 2011, to 78 months in prison. Hossain was sentenced by Judge Buchwald on March 1, 2012, to 29 months in prison. The sentencings of Larochelle, Barnett, and Huq are pending.

Criminal charges remain pending against the following defendants: Eric Finger, Reginald Johnson, Denise Parks, and Brandon Lisi. The trial for these defendants is scheduled to begin on May 7, 2012, and they are presumed innocent unless and until proven guilty.

Preet Bharara, the United States Attorney for the Southern District of New York, announced the guilty pleas.

Mr. Bharara praised the outstanding investigative efforts of the New York Attorney General’s Office, which led the investigation and has collaborated in the prosecution. He also thanked the Federal Bureau of Investigation and the New York State Department of Financial Services for their assistance in this case.

This case is being handled by the Office’s Complex Frauds Unit. Assistant United States Attorneys Michael D. Lockard and Ryan P. Poscablo, and Assistant Attorney General Meryl Lutsky ““ who is designated as a Special Assistant U.S. Attorney in this case ““ are in charge of the prosecution.

Manhattan U.S. Attorney Preet Bharara said: “Frederick Warren, Dorian Brown, and Fritz Bonaventure betrayed the lending institutions for which they worked, approving loan applications they knew were bogus and would end up in default. Their pleas are sterling examples of how federal and state authorities can work together to identify, prosecute, and punish those who engage in mortgage fraud.”

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Allison Tussey

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