Real Estate Agent Jailed for Facilitating Submission of Fraudulent Loan Packages

Allison Tussey —  November 25, 2013 — 3 Comments

Michael Abobor, 38, Bowie, Maryland, was sentenced by U.S. District Judge Peter J. Messitte to 51 months in prison, followed by five years of supervised release, for wire fraud in connection with a mortgage fraud scheme involving intended losses of at least $2 million.

Judge Messitte also entered an order that Abobor forfeit $2,026,205 and pay restitution of $1,832,650.

According to his plea agreement, in the Spring and Summer of 2007, Abobor, a licensed real estate agent, submitted fraudulent loan applications for the purchase of homes in Maryland. Abobor purchased two homes in his own name, and purchased the rest of the homes using the names, and credit, of various friends and family members. Each loan application contained fraudulent information about the borrower’s earnings (including their monthly income and their assets) and employers, of which Abobor had full knowledge. Some of these applications contained fake documents, like doctored W-2s and paystubs; and all of them alleged that the borrower made much more money than he or she really did. Based on these fraudulent application materials, the victim lending institutions funded loans that totaled hundreds of thousands of dollars, resulting in substantial commission payments to Abobor. Eventually, each of these loans fell into default, causing large losses to the victims. Abobor also received large amounts of money that were disguised as “renovation payments” and funded by the mortgages

For example, on July 25, 2007, Abobor facilitated the purchase of a home in Bowie, and while serving as the buyer’s real estate agent, knowingly submitted a false loan application on the buyer’s behalf. The loan application, among other things, vastly inflated the buyer’s monthly income figures. Relying upon these false representations, the lending institution funded a loan of $375,000. As part of this transaction, Abobor received a commission payment of $5,499, and also received over $37,000 in “renovation” payments.

In all, Abobor arranged at least seven fraudulent real estate transactions, caused more than $2,000,000 in intended losses to victim financial institutions, took in excess of $20,000 in fraudulent real estate commissions, and collected over $270,000 in extra money from the transactions in the form of third party disbursements for renovations that were never completed.

The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Inspector General Jon T. Rymer of the Federal Deposit Insurance Corporation; Special Agent in Charge Kathy Michalko of the United States Secret Service – Washington Field Office; and Special Agent in Charge Cary A. Rubenstein of the Housing and Urban Development Office of Inspector General – Office of Investigations.

United States Attorney Rod J. Rosenstein praised the FDIC Office of Inspector General, U.S. Secret Service and the Department of Housing and Urban Development Office of Inspector General for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Sujit Raman, who prosecuted the case.

The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available www.justice.gov/usao/md/Mortgage-Fraud/index.html.
 

 

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3 responses to Real Estate Agent Jailed for Facilitating Submission of Fraudulent Loan Packages

  1. So much fraud going on! Maybe this agent, Michael Abobor will learn not to send fraudulent loan packages.

  2. This is common practice among real estate agents. The only way to finally put a stop to it is to eliminate real estate agents entirely. They add no value to the process, but operate with no regard for ethics or laws.

  3. Stephen, you’re ignoring that agents can bring a lot of value to the table as well. Yes, there are a lot of people in the industry who lack ethics, but don’t forget there are a lot of honest agents who also suffer thanks to the bag eggs, and they’re just as annoyed as you are!

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