“Mortgage Fraud is a serious issue facing Nassau residents. In many instances we find defendants working in concert to carry out their frauds and preying on those that are facing financial hardship.â€
- Nassau County District Attorney Denis Dillon.
Six individuals were charged in Nassau County, New York as a result of a mortgage/real estate fraud sweep. The fraud schemes involved different defendants and were carried out in a variety of ways. In the most egregious case the principal defendant attempted to steal the homes of two victims, who were facing financial hardship, by engaging in an elaborate real estate foreclosure rescue scam. In another case a defendant diverted for his own benefit $16,000.00 of the mortgage proceeds at the closing that the homeowner was entitled to receive. In a third case the defendant sold property he did not even own to two different attorneys. In a fourth case a defendant sold the same piece of property to two different buyers just twenty days apart.
Those charged were:
Alton Lawson, a.k.a. Alton Lawson a.k.a. Lamont Lawson, 43, Queens, New York
Chester W. Matthews, 54, Richmond Hill; New York
Reginald Johnson, 32, Brookhaven, New York
Louis Carter, 54, Roosevelt, New York
Daniel Stern, a.k.a. Daniel Slovak, 41, Brooklyn, New York
Jamal Zafar, 34, Huntington, New York
Lawson, Matthews and Johnson are accused of defrauding a 45 year old woman from Roosevelt and a 80 year old female Hempstead resident, who were both homeowners that were having financial difficulties. According to authorities, each victim received unsolicited visits from Lawson who told them he could help them save their houses by refinancing. Lawson tricked the victims into selling their houses to Matthews for $295,000 and $320,000.
Matthews, who was serving as a straw buyer for Lawson, was able to purchase the properties of the victims by obtaining mortgages for the full amounts on the basis of fraudulent income information submitted on the mortgage applications.
Johnson, who was the mortgage broker from Reliable Capital Corporation, provided the fraudulent mortgage application that was submitted to one of the lenders which enabled Matthews to â€˜purchaseâ€™ the Hempstead, New York home. Johnson also provided Lawson a â€˜showâ€™ settlement check made out to the Hempstead victim for $15,852.27 that was shown at the closing which enabled the loan to close. After the closing, Johnson had the check deposited into his bank account.
Although the outstanding mortgage on the Roosevelt victimâ€™s house was paid, she received nothing, while Lawson received mortgage proceeds totaling $46,383.54. Although the tax lien on the Hempstead victimâ€™s home was paid, she received only $150,555.10 of the mortgage proceeds, while Lawson received mortgage proceeds totaling $110,500. Matthews was paid $17,500 and $20,000 by Lawson for serving as the â€˜strawâ€™ buyer on each of the two properties. Johnson was paid $10,715 from the mortgage proceeds for serving as the mortgage broker on the sale of the Hempstead house.
After essentially stealing the houses of the two victims and retaining substantial portions of the mortgage proceeds, Lawson, in the name of Matthews, the purported owner of the properties, had begun eviction proceedings to evict each complainant.
Lawson, who was the principal architect of this fraud, has been charged with two counts of grand larceny and two counts of criminal possession of a forged instrument. Johnson has been charged with one count of grand larceny and one count of criminal possession of a forged instrument. Matthews was charged with two counts of grand larceny and two counts of criminal facilitation.
Carter was charged with one count of grand larceny. According to authorities, Carter was given power of attorney by a Wyandanch woman to sell her house at 19 Beech Street, Wyandanch, New York. Carter sold the property for $250,000 on May 10, 2005. At the closing the victimâ€™s mortgages of $174,589.19 and $16,952.89 were paid off, as were other closing costs. The victim, however, received only one check for $7,926.90. According to authorities, the investigation disclosed that at the closing Carter, without authorization or permission, directed that a check for $16,000 be made out to pay for three months past due rent that he owed.
Stern was charged with one count of grand larceny and two counts of criminal possession of a forged instrument. According to authorities, on June 23, 2004, Stern, while posing as an attorney and the President of Nietos Realty, Inc. sold a piece of commercial property located at 286 Willoughby Avenue in Brooklyn, New York to an attorney. During the next month the victim attempted to work on the property with the intention of building condominiums, but discovered that another party was already conducting repairs. Upon further inquiry the victim discovered that Stern had sold the same piece of property to another attorney. According to a statement by Nassau County District Attorney Denis Dillon, after further investigation it was discovered that Stern is not an attorney and that the property was actually owned by another Nietos Realty, Inc.
Zafar was charged with one count of grand larceny and one count of criminal possession of a forged instrument. According to authorities, on March 14, 2004, Zafar offered to sell a house located at 1542 Brentwood Road, Bayshore, New York to two individuals. Zafar told them that the purchase price was $155,000 but that the property had to be purchased in cash and could not be financed. Zafar further stated that the house was a Section 8 rental and needed some repairs, but told them not to worry about repairs since they would be receiving the $1,400 monthly rent from Section 8. The victims, who were looking for investment properties, agreed to the offer. On March 18, 2004, the victims paid $155,000 in cash for the property. The deed, however, was executed in the name of Zafar who said that he would sell the property for them. After several months of stalling Zafar finally conveyed the property by a signed deed executed on August 11, 2004. The deed was recorded on September 2, 2004 at the Suffolk County Clerkâ€™s Office. When the victims went to record the deed, however, they discovered that Zafar had already sold the same house to another individual on July 22, 2004 for $275,000.
“Mortgage fraud is a growing phenomenon in our country,” Dillon went on to say. “It is being fueled by a very hot real estate market and very slick, unscrupulous individuals who seek to exploit financially vulnerable homeowners. The arrests that I am announcing today underscore the importance of exercising extreme caution when it comes to buying or selling a home or property.”
Dillon offered two specific pieces of advice: First, homeowners should always be represented by legal counsel of their own choosing who will protect their interest at the closing; and second, homeowners should never agree to sign a quitclaim deed on the representation that they will get their home back at a later time. In many cases the homeowner has lost the home forever.
It is extremely important that homeowners do not rush in to any real estate transaction and that they consult with reputable professionals before parting with what is perhaps, their most valuable asset â€“ their home.”