Real Estate Agent Admits Leadership Role in Mortgage Scam

Allison Tussey —  August 9, 2011 — Leave a comment

Robert Alexander, 36, Phoenix, Arizona pleaded guilty for his role as a real estate agent representing buyers who purchased multiple homes with loan applications containing false information and concealing from the lenders “kick backs” to the buyers. 

Alexander pleaded guilty to Conspiracy to Commit Wire Fraud.  One other co-conspirator has pleaded guilty for his involvement in the conspiracy.

Between September 2005 and August 2006, Alexander found sellers of distressed properties and offered more than their asking price. He obtained inflated appraisals to support the loan amounts. He would recruit a buyer that he knew would not be qualified to purchase multiple homes. He facilitated the submission of loan applications containing false information. At closing, he instructed the escrow officer to disburse monies back to the borrower. He obtained both a commission and, in many cases, a bonus from the fraudulent transactions. The conspiracy involved as many as forty-four homes that went into foreclosure resulting in estimated losses of $2,500,000 to lenders.

Sentencing is set before Judge James A. Teilborg on October 31, 2011. The investigation in this case was conducted by the Internal Revenue Service, Criminal Investigations Division. The prosecution is being handled by Kevin M. Rapp Assistant U.S. Attorney, District of Arizona, Phoenix.

Dennis K. Burke, U.S. Attorney for the District of Arizona, highlighted the significance of this guilty plea. “Mortgage fraud has destroyed property values, lending institutions, and entire neighborhoods in our community. It has resulted in the loss of tax revenues and jobs. To those who engage in mortgage fraud — particularly real estate industry professionals in which the public places trust ““ we are keenly focused on this illegal activity.”

IRS Criminal Investigation Assistant Special Agent in Charge, Gabriel Grchan added, “With the foreclosures of 44 homes and an approximate $ 2.5 million dollar loss to lenders, this investigation once again demonstrates how mortgage fraud has contributed to the collapse of our real estate market in Arizona.  IRS CI will continue to aggressively pursue those individuals who commit these types of crimes.”

The case against Alexander was based on an investigation by the Internal Revenue Service, Criminal Investigation Division.

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Allison Tussey

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