Jeffrey Youngheim, 47, Portage, Indiana, and Richard Loveless, 52, Gary, Indiana, were sentenced by District Judge Joseph Van Bokkelen for their roles in a large-scale mortgage fraud scheme.
Youngheim and Loveless both pled guilty to the felony offense of wire fraud. Youngheim was sentenced to 21 months’ imprisonment, one year of supervised release, and a $100,000 fine. Loveless was sentenced to15 months of imprisonment, one year of supervised release, and a $50,000 fine.
According to documents filed in this case, Youngheim participated in a large-scale mortgage fraud scheme designed to unjustly enrich himself and his business partner Loveless (among others) to the detriment of neighboring homeowners in Gary, Indiana, and taxpayers generally. Individuals who were recruited to buy most of the houses sold in the scheme were first-time home buyers with little practical experience in the field of real estate and with limited to no familiarity with the Gary, Indiana real estate market.
Nearly everything said to induce buyers to buy these houses was a lie. They were told the houses were good investments when in fact they were in disrepair. They were told the houses would be rehabilitated when in fact few, if any, of the necessary repairs were actually completed. Little effort was made to keep the promises after the first month or two of mortgage payments had been made. Youngheim and Loveless and/or a trust held for the benefit of their joint business, Property Liquidators Inc., owned five of the 25 properties sold in the scheme.
This case was the result of an investigation by the Federal Bureau of Investigation. This case was prosecuted by Assistant United States Attorney Jill Koster.