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Archives July 2, 2006




Fraud News Wire

Last Updated Thursday, July 06, 2006, 05:22 PM Texas Time

Bad Lawyers

A rash of crooked attorneys has descended upon real estate finance.

From Chicago to Connecticut, lawyers are facing charges of stealing from clients, ripping off churches and withholding funds from lenders.

In the most recent case, Stephen Gionfriddo, 55, the former mayor of Middletown, Conn., and a longtime prominent attorney, pleaded guilty Thursday to stealing more than $600,000 from clients of his law firm.

Much of the money was supposed to pay off mortgages. But instead, federal prosecutors say Gionfriddo used the cash to cover gambling losses.

read Patrick's full story at MortgageDaily.com

Atlanta Originators Lose Licenses

Georgia regulators have pulled the licenses of two mortgage brokers as they continue to aggressively attack what has been rampant fraud throughout the state. The latest cases involve poor record keeping and outright fraud.

"We're cracking down," Rod Carnes, deputy commissioner with Georgia Department of Banking and Finance, told MortgageDaily.com.

The state, plagued with a rash of mortgage fraud for years, recently strengthened regulations and stepped up enforcement -- pushing its ranking on the list of states with the most fraud down to No. 3 last year from the No. 1 spot, according to a recent analysis by the Mortgage Asset Research Institute.

"This drop may be due to the aggressive legislation and enforcement Georgia officials have recently put in place," MARI said in the report.

read Patrick's full story at MortgageDaily.com

(subscription required)

June 29, 2006

Pastor's Sons Indicted

Kenneth Fairley Jr. and brother William Vaston Fairley, who were both indicted in a mortgage fraud scheme, are the sons of a political activist who is also senior pastor of a Baptist Church.
read story from the Hattiesburg American .

June 28, 2006

MASS AG Warns About Mortgage Fraud
The Massachusetts Attorney General released a series of tips for prospective borrowers to avoid being stung by mortgage fraud.

Real Time Closing Data
Ciercus Systems plans to release a Web-based system that will enable mortgage lenders and warehouse-line providers to monitor closings with real-time data.

Mortgage Broker Fraud Survey
A survey more than 20,000 mortgage brokers found more than a quarter have had a fraudulent 1003 loan application submitted to them during the past three years.

Attorney, Paralegal Charged
Former attorney John E. Sanborn and his paralegal Joan E. Marcott were charged with, among other things, mortgaging a property owned by someone else.
read story from The Janesville Gazette .

8 Re-Indicted
Kenneth Fairley Jr. was added to a reindictment of eight mortgage fraud defendents
read story from NEWS 7 .

Girlfriend Used to Hide Assets
Ronald Miserendino is accused of selling a Hawaiin property to his girlfriend to hide the asset from his estranged wife and from the IRS.
read story from the Journal Sentinel .

Man, Wife & Son Indicted
Corey Hazel, his wife and his son were indicted for fraudulently obtaining a $230,000 mortgage on a $50,000 home.
read story from nbc4i .

Realtor Arrested
Laura-mae Gabbidon, a licensed real estate broker, was arrested for mortgage fraud and identity theft.
read story from The Atlanta Journal Constitution .

Bogus Bank
Century Bank vice president of risk management and fraud Melody Shimmell said they had one borrower submit an application indicating $100,000 was in an account with a nonexistent bank.
read story from The Herald-Tribune .

Fraud is Cost of Doing Business
Fraud is a cost of doing business for banks, with approximately 3 million adults claiming to be victims of bank card abuse in 2005.
read story from Finance Tech .

Fed Order Issued Against Originator
Tampas B. Riggs, a former employee of a Regions Bank branch in Orlando, Fla., consented to a prohibition order issued by the Federal Reserve Board, according to an announcement Thursday.
read story from MortgageDaily.com
(subscription required)

Attorney Indicted
Stephen Yagman, a prominent attorney known for filing high-profile lawsuits against law enforcement agencies, is accused of hiding assets from IRS collection agents.
read Associated Press story .

Pair to Study Mortgage Fraud Convicts
Funded by a grant, Doug Bachtel and Andrew Carswell are looking for convicted mortgage fraudsters to interview and get deeper insight into the minds of real estate criminals, then feed their findings into a computer.
read story from the Athens Banner-Herald .

June 26, 2006

Bad Mortgage Lawyers
A rash of crooked attorneys has descended
upon real estate finance.

June 25, 2006

Realtor Admits Role in Fraud Scheme
Florida real estate broker Mary E. Bolan pleaded guilty to charges of mortgage fraud but contends she committed no crime.
read story from the Bradenton Herald .

Vice President Dupes Lender
Todd A. Kolbe was fired and sued by Opteum Financial Services, where he was a regional vice president, for millions of dollars in losses and now faces sentencing along with two women.
read story from the Bradenton Herald .

Mortgage Fraud Increases Property Taxes
Fraudulent mortgage transactions that enable the sale of a property at an inflated value can cause neighborhood property taxes to increase.
read story from the Austin Weekly news .

Fake Tax Service
Elleanor Spann, operator of Nora’s Tax Service, admitted creating fake tax returns for $412,000 in loans funded by BB&T.
read story from The State .

Woman Caught Forging Ex's Signature
Marie Mathurin was arrested for using an unidentified male to forge her ex-husband's name to $30,000 from a cashout loan.
read story from Newsday .

Fraud Victim Becomes Beneficiary
Aurora Lepe, whose identity was used to fraudulently buy a home that eventually fell into foreclosure, was awarded the $51,000 in surplus equity from the auction sale.
read story from the San Francisco Chronicle .

Title Company Owner, Employee Indicted
American Security Title owner Stephanie Corsmeier, and employee Stacey Lester deny the conspired with loan officers in a down payment scheme.
read story from The Pulse Journal .

Republicans Spar Over Foreclosure Bailouts
Rep. Randy Johnson of Florida said if he wins the chief financial officer election, he would crack down on predatory lending schemes, while his Republican opponent said state regulators may be helpless to overrule federal regulators.
read story from the Palm Beach Post .

Homegold Findings Announced
South Carolina's attorney general said a state grand jury is satisfied that everyone who should be charged with wrongdoing in the Carolina Investors/ HomeGold Financial Inc. collapse has been charged.
read story from The State .

Former Mayor Stole from Clients
Suspended attorney and former Middletown, Conn., mayor Stephen T. Gionfriddo was expected to plead guilty to diverting more than $750,000 in clients' money -- much from real estate -- for his own benefit.
read story from the Hartford Courant .

Tips to Avoid Sting from Fraud
The Illinois Bankers Association warns prospective borrowers to thoroughly review all of the mortgage documents, stay away from providing false information and avoid closing on any transcations where fraud may be involved.
read story from The Business Journal .

Notarized Deeds to Reduce IL Fraud
A new Illinois mortgage law signed by the governor this month and taking effect Jan. 1, 2007, requires all property deed signatures to be notarized.
read story from the Elk Grove Times .

Ft. Worth Fireman Fingered for Fraud
Anthony "Tony" Lewandowski, a Ft. Worth firefighter, was arrested for allegedly helping seven other defendants defraud financial institutions and mortgage lenders.
read story from the Star-Telegram .

Probation Turns to Prison
Daniel Meachum was ordered to spend 180 days in jail for missing his $850 monthly restitution payments to mortgage fraud victims that was part of his probation sentence last year.
read story from the South Bend Tribune .

Patrick Crowley is fraud journalist for MortgageDaily.com and a reporter and columnist for The Cincinnati Enquirer.

Email Patrick at: PatCrowley@FraudBlogger.com
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