Mary Reagan, closing attorney, 39, Alpharetta, Georgia, was charged in a superseding indictment along with Adriene Newby-Allen, aka Cassandra Miller, 39, Alpharetta, Georgia; Brinson Allen , 38, Alpharetta, Georgia; and James Howard Bailey, III, 35, Houston, Texas, on charges of conspiracy, bank fraud and wire fraud in connection with an alleged mortgage fraud scheme.
A federal grand jury charged Reagan in a superseding indictment, filed March 13, 2007, along with co-defendants Newby-Allen, Allen and Bailey, that alleges that Reagan's co-conspirators obtained mortgage financing and home equity loans from federally insured as well as private lenders. The loan values, which ranged in the aggregate from $2.5 up to $3.2 million, were inflated based upon allegedly false credit applications, including false representations regarding borrower income, employment and assets, and inflated appraisal reports. Newby-Allen used her own business, Swiss Acquisitions, Inc., to fund borrower down payments and borrower contributions.
The property addresses named in the indictment are:
11795 King Road, Roswell, Georgia
2300 Blackheath Trace, Alpharetta, Georgia
680 Heards Ferry Road, Atlanta, Georgia (Attempt)
261 Hawks Lake Drive, Ball Ground, Georgia
10890 Bell Road, Duluth, Georgia (Lot)
10890 Bell Road, Duluth, Georgia (Construction Loan) (Attempt)
320 Longvue Court, Duluth, Georgia (Attempts)
Reagan, who operated her own real estate practice and closed several of the loans at issue in the indictment, is alleged to have disbursed millions of dollars in loan proceeds to defendant Newby-Allen. Reagan is alleged to have disbursed loan proceeds inconsistently with the settlement statements she prepared and disclosed to the victim lenders or to have prepared multiple settlement statements - one that was disclosed to the lender to facilitate her alleged fraud scheme and another that was disclosed to the seller to ensure that the seller proceeded to closing and did not blow the whistle. As alleged in the indictment, these fraudulent disbursements amounted to millions of dollars in loan proceeds not going to the sellers of the subject properties, with Reagan allegedly realizing $40,000 in kickbacks.
United States Attorney David E. Nahmias said, “The FBI and other federal investigative agencies continue to aggressively investigate mortgage fraud. Mortgage fraud can be facilitated by closing attorneys who abuse their position of trust to knowingly process fraudulent closing documents. We are focusing attention on real estate professionals, including closing attorneys, who allegedly abuse their fiduciary obligations to mortgage lenders for significant personal profit and the substantial financial gain of their alleged co-conspirators.”
Rachel Dollar, the editor of Mortgage Fraud Blog is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors.