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Insights from Patrick Crowley

Archives July 24, 2005

 


 

July 20, 2005


We don't see a lot of mortgage fraud involving manufactured housing, but here's a case out of southern Oregon.

Marcus Allen Carter, 23, has been arrested on mortgage fraud and other charges for his connections to Alpine Mountain Homes, which state authorities are investigating for racketeering.

The Mail Tribune in southern Oregon is reporting that Alpine is accused of stealing more than $450,000 from 15 people who claim they were charged for services they did not receive. Carter reportedly worked for the company.

In a lawsuit filed against Alpine's owners Oregon Attorney General Hardy Myers has alleged the company broke the state's racketeering laws by allegedly stealing, violating the state's mortgage broker laws and forgery. Several alleged victims have also filed suit.

read story from the Mail Tribune


Here's another scam that was targeting illegal aliens, this one out of Kansas.

Mortgage loan processor Mary Rachel Olivarez and real estate agent Carlos Ruano Cruz have pleaded guilty to federal charges that they defrauded the FHA loan program when securing mortgage loans for what federal prosecutors called "undocumented aliens."

Cruz referred illegal aliens to Olivarez, who was manager of American Home Loans. They used phony Social Security numbers to apply for 24 fraudulent FHA loans totaling $1.4 million. Both allegedly knew that the buyers were illegal aliens who did not have Social Security numbers.

"Only United States citizens and permanent resident aliens are entitled to receive FHA loans," the U.S. Attorney's office said in a statement.

After the scam worked once they continued to submit the phony loan applications. Each faces five years in prison and fines of up to $250,000.

read story from the Kansas City Business Journal

read announcement from the Department of Justice


You would think a mortgage broker would know better, that if you submit phony loan documents and inflate appraisals you're going to get caught.

That's what happened to Vernon David Williams, 58, a former Kansas City mortgage broker who appears on his way to prison for trying to defraud mortgage lenders.

Williams has pleaded guilty to federal fraud charges, admitting he tried to scam two lenders-- MILA Inc. and Finance America LLC, according to federal prosecutors.

Williams said he prepared false loan applications and supporting documents to get a loan for nearly $159,000. He faces up to 20 years in prison and a fine of up to $500,000.

read story from The Kansas City Star

read announcement from the Department of Justice


Borrowers in the U.S. are apparently being scammed by a mortgage fraud operation being run out of Canada.

The Daily Press in Hampton Roads, Va., is reporting that a woman in Windsor, Va., lost money by trying to get a loan through Loyola Credential Business Services, aka Weisberg Financial. The woman appears to have fallen for an old scam.

She responded to a newspaper add offering mortgage loans to borrowers with bad or not credit. After receiving approval for a $100,000 loan she sent a $2,000 payment, via Western Union, to cover collateral and insurance.

That was in February. The woman has reportedly not seen her money or the mortgage loan, and when she tried to contact the company the firm's number was disconnected.

The guy running the scam was apparently using a cell phone to avoid detection.

The woman has virtually no chance of ever getting her money back.

read story from the Daily Press


July 18, 2005


Judging by the cars they drove three Georgia residents must have been making some darn good money on their alleged mortgage fraud scheme.

As part of their investigation into the half million dollar fraud ring federal prosecutors want to seize a 2005 BMW, a 2005 Land Rover, a 2006 Benz and $300,000 in cash found in a self-storage unit.

Three people have been indicted for crimes that include conspiracy, fraud, money laundering and identity theft. They are: Stacey Shefton, 33; Michael Dunn, 39; and Willie Anderson, 37.

An indictment alleges that the trio conspired to defraud mortgage lenders by using phony information to get loans. In one transaction Dunn allegedly bought a home for $17,600 and then quickly sold it to his girlfriend for $50,000, according to The Augusta Chronicle.

The couple used phony information on the loan application.

In other instances the defendants were charged with arranging for straw buyers to appear at the office on a closing attorney and pose as actual buyers for homes. And Shefton is accused of stealing another person's identity and using that information to get a mortgage loan.

read story from The August Chronicle


Good lord, a Tennessee preacher has been convicted of mortgage fraud.

The Rev. Gerald Rayborn, 59, pastor of the New Mount Sinai Missionary Baptist Church in Memphis, has been convicted by a federal grand jury of submitting a phony tax return to a mortgage lender in order to get a mortgage loan, according to the U.S. Attorney's office in Memphis.

Rayborn was convicted of conspiracy to commit wire fraud, mail fraud and money laundering. An indictment returned against Rayborn alleges he conspired with CPA Larry Bullock on the phony tax return. Bullock was also convicted in a separate trial.

Rayborn faces 65 years in prison. He's scheduled to be sentenced Oct. 14.

read announcement from U.S. Attorney


July 17, 2005


The Patriot Ledger had a great lead in writing about a mortgage fraud case out of Boston involving the restoration of an historic home, saying the perp was convicted for giving the house "an illegal makeover."

A federal grand jury found Jamie Edelkind, 41, guilty of submitting a phony mortgage loan application to get a $3.3 million refi on the Honey Fitz mansion, a seaside resort that once served as a summer house for JFK's grandpa.

During a six-day trial it came out that Edelkind, who had filed for bankruptcy in 1999, filled out a mortgage application claiming his wife made more than $200,000 a year. He submitted the application when he bought the mansion for $900,000 in 2000.

Turns out the wife is just a homemaker and didn't make or have that kind of dough.

As the value of the house increased Edelkind refinanced it three times, going even deeper in debt, and took out three home equity loans for $730,000. Prosecutors say at least one of the equity loans was a fraud and Edelkind pocketed $221,000.

The government is trying to seize the house. Edelkind go up to prison for 30 years and pay $1 million in fines.

read story from The Patriot Ledger

read announcement from the Department of Justice


A globe-trotting New York man has admitted his role in a $3.1 million mortgage fraud scheme.

Sam Hilany, 35, has pleaded guilty to masterminding a fraud ring that used stolen IDs, inflated appraisals and straw buyers who were paid up to $15,000 to act as buyers to obtain fraudulently mortgages on nine properties, according to the Nassau County district attorney.

Washington Mutual Bank took the biggest hit, lending money on seven of the properties.

When the heat was coming down Hilany took off and spent four months on an overseas jaunt. According to the NY Times, the Department of Homeland Security picked up on his name on the manifest of a Lufthansa flight from Frankfurt, Germany, to Mexico City.

But Mexican authorities met the flight and turned Hilany away, sending him back to German. From there he was returned to the states.

Several of his accomplices reported pleaded guilty earlier this year. All operated out of Long Island and Queens in the New York City Area. Most of the phony mortgages were for homes in Brooklyn.

read story from The New York Times

read announcement from Nassu County District Attorney


A husband and wife are going to jail for running a Denver-area mortgage fraud scheme that included greasing a banker with a bribe.

The Denver Business Journal is reporting that Thomas and Janel Marie Skinner, former loan originators and operators of Mile-Hi Lending LLC in Parker, Colo., have been convicted of federal mail and bank fraud.

He will do 15 months; she got a year and a day. The hubby must also pay more than $800,000 in restitution to Fairbanks Capital Corp. and U.S. Bank.

The Skinners' misdeeds included reportedly altering income statements and appraisals and bribing James Ezzard Gadson, a bank employee, to go along with their scheme. The federal judge handling the case gave Gadson three years probation.

read story at Denver Business Journal

 
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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