Archives For Short Sale Fraud

Adel Afkarian, 42, Carlsbad, California, and Atef Afkarian, 40, Slidell, Louisiana, were sentencedto prison for their role in a fraudulent “debt elimination” scheme that purported to eliminate the mortgages on several million-dollar homes in San Diego, California.

U.S. District Judge John A. Houston sentenced Adel Afkarian to serve 18 months in custody and Atef Afkarian to serve 13 months.  In addition to the time in custody, the brothers who are both former real estate brokers, were both ordered to pay more than $5.5 million in restitution to the victims of the scheme.

To implement the scheme, the Afkarians identified underwater homeowners—including themselves—and began a process to make it appear as though the homeowners’ debts had been satisfied.  To do so, they recorded fraudulent deeds that purported to extinguish the large mortgage loans encumbering each property.  They then sold the properties to innocent purchasers, deceiving the buyers into paying the full purchase price to the Afkarians or their co-conspirators.  The mortgage lenders, unaware of the fraudulent documents recorded on title or unable to prevent the sale in time, were left unpaid.  Continue Reading…

Michelle M. Borzillo, 59, Bristow, Virginia, a former attorney with the Federal Deposit Insurance Corporation (FDIC) was sentenced  to 12 months and one day in prison, followed by two years of supervised release, for defrauding Wells Fargo Bank in connection with the sham short sale of her home to her live-in boyfriend.  She was also ordered to pay $288,497 in restitution and to forfeit the proceeds of her offense.

Borzillo pleaded guilty on November 17, 2015 to committing bank fraud.  According to court documents, the defendant was a senior attorney at the FDIC until September 2014.  In 2007, she purchased a home in Nokesville, Virginia, for $850,000, with mortgages totaling $807,500 from Wells Fargo Bank.  In 2013, she engineered the short sale of her Nokesville home to her boyfriend, who had been living with her at the property for several years.  Continue Reading…

Jaime Olaya Marroquin, a/k/a Jaime Olaya, 53, was sentenced to 30 months in prison, followed by three years of supervised release for arranging a fraudulent short sale of a 10-acre residential property in Southwest Ranches, Florida. Marroquin previously pled guilty to one count of bank fraud.  As part of his plea agreement, Olaya agreed to forfeit the 10-acre property involved in the transaction.

According to court documents, in 2005, Olaya purchased a 10-acre residential property in Southwest Ranches, Florida. In 2008, he quitclaimed ½ of the property to AJZ Investments (AJZ), a company he controlled. To avoid having to continue making payments on the $1.6 million mortgage debt, Olaya submitted a request to the bank for a short sale on the property while intentionally excluding the portion of the property he quitclaimed to AJZ. Continue Reading…

Dahianara Moran, 40, Methuen, Massachusetts, pleaded guilty to one count of conspiracy to commit bank fraud for to participating in a conspiracy to defraud banks and mortgage companies by engaging in sham “short” sales of residential properties in the Merrimack Valley of Massachusetts.

Moran conspired with others – including a Methuen loan officer and a Haverhill real estate agent who were not identified in the charging document – to defraud various banks via bogus short sales of homes in Haverhill, MassachusettsLawrence, Massachusetts, and Methuen, Massachusetts. Continue Reading…

Christopher Nelson, 46, Henderson, Nevada, and Niket Kulkarni, 38, Los Angeles, California were indicted by the Clark County, Nevada, Grand Jury, along with Thomas J. Adams,  Robyn D. Reese, and James Sheridan Reese, in connection with a short sale rescue fraud scheme. The charges include racketeering, pattern of mortgage lending fraud, theft, theft from a person over the age of 60, and failure to place a mortgage fee of over $1,000 in escrow. The defendants operated their business, the American Equity Foundation, between July 2012 and May 2013.

According to the indictment, the defendants are accused of soliciting customers to participate in a short sale program purportedly associated with the federal government called the Neighborhood Stabilization Plan. Defendants falsely represented to their clients that their business could facilitate the short sales of customers’ homes to investors. Clients were also told that they could then lease their homes from the investors for two to four years, before having the opportunity to repurchase those homes at a cost of 90-100% of the home’s market value. Through these representations, the defendants are alleged to have unlawfully obtained more than $133,000 from their clients.

Continue Reading…

George Bussanich Sr., 56, Park Ridge, New Jersey, and his son, George Bussanich Jr., 35, Upper Saddle River, New Jersey, were arrested for engaging in a short sale buy-back scheme that used straw buyers and short sales on two Bergen County, New Jersey, properties to defraud mortgage lenders out of hundreds of thousands of dollar.  Each were charged by indictment with one count of conspiracy to commit bank fraud and two counts of bank fraud. They are scheduled to appear this afternoon before U.S. Magistrate Judge Cathy L. Waldor in Newark federal court.   Continue Reading…

Charise Stone, 46, Ashburn, Virginia, was sentenced to 60 months in prison, followed by three years of supervised release for her role in a real estate short sale scheme that included tax and mortgage fraud, and passing fraudulent financial documents. Stone was also ordered to forfeit $721,552, and ordered to pay restitution of $2,441,174 to the victim financial institutions and the IRS.

Stone was found guilty by a federal jury on May 27, 2015 in the short sale scheme. According to court documents, from 2007 to 2010 Stone targeted distressed homeowners who owed more on their mortgage loan than the market value of the home with false promises of financial recovery. Stone acquired distressed homeowners’ properties in her own name or under entities she controlled, made false representations to mortgage lenders in order to induce approval of the short sales, and then re-sold the properties—often the same day or the next—to new buyers at a price above the short sale amount, in violation of agreements made with mortgage lenders. Continue Reading…

Delio Coutinho, 73, loan officer, Woodbridge, New Jersey was sentenced to 36 months in prison for his role in a large-scale short sale mortgage fraud scheme that caused millions of dollars in losses.  Coutinho previously pleaded guilty before U.S. District Judge Susan D. Wigenton to an information charging him with conspiracy to commit wire fraud.  Continue Reading…

Jerome Whittington, 65, La Quinta, California; Patricia Torres Zavala, 42, Benicia, California; and, Kathleen Moore, 68, Olympia, Washington have been charged by a federal grand jury for their roles in a variety of fraudulent schemes, including one involving short sales, that victimized at least 20 investors and caused losses of more than $2 million.

The three defendants were charged in a superseding indictment filed on July 8, 2015. The 24-count indictment alleges that they lied to investors in a series of schemes, and then used investor money for personal expenses rather than investing the funds as promised.

Whittington is also charged in a separate case with posing as a former federal prosecutor in a case involving a former DEA agent.  Continue Reading…

A federal grand jury returned a 15-count indictment against seven individuals, charging them with conspiracy to commit mail fraud and bank fraud, mail fraud and aiding and abetting, and making false statements to a bank in a mortgage fraud scheme.

Jyoteshna Karan, 43, Modesto, California; Praveen Singh, 36, Modesto, California; and Mahendra Prasad, 53, Fremont, California, were arrested June 26, 2015 at their homes. The remaining defendants each received a summons to appear for arraignment: Phul Singh, 79, Modesto, California; Sunita Singh, 60, Modesto, California, Nani Isaac, 69, Ceres, California; and Martin Bahrami, 42, Turlock, California. Continue Reading…