WASHINGTON -- (April 30, 2007) -- MARK J. MERSHON, Assistant Director in Charge of the Federal Bureau of Investigation in New York (www.fbi.gov), announced the arrests of nine people on charges of bank fraud. MOHAMMED ZUBAIR HOSSAIN ( "ZUBAIR" ), TOGOR [last name unknown] ( "TOGOR" ), MOHITUL ISLAM ( "MOHITUL" ), MOHAMMED JEWEL ( "JEWEL" ), MEHDI HASAN ( "HASAN" ), IQBAL HASAN ( "IQBAL" ), HUMAYUN KABIR ( "KABIR" ), GOLAM BAHUDDIN SADI ( "SADI" ) and MIZANUR RAHMAN ( "RAHMAN" ) were arrested early this morning in the culmination of an eighteen-month investigation into a home mortgage fraud conspiracy that operated primarily from a base in Jackson Heights, Queens. LALON AHMED ( "AHMED" ), the tenth defendant charged in the investigation, is still at large. The charges are contained in a federal criminal complaint ( the "Complaint" ) unsealed today in United States District Court for the Eastern District of New York.

According to the Complaint, defendants TOGOR, MOHITUL and ZUBAIR were principals in New Generation Funding ( "NGF" ), a mortgage broker with a branch office in Jackson Heights. The Complaint alleges that TOGOR, MOHITUL and ZUBAIR recruited "straw buyers" from the Bangladeshi community to purchase properties with false identities and to secure mortgage financing. AHMED, JEWEL, HASAN, IQBAL, KABIR, SADI and RAHMAN were among the straw buyers, according to the Complaint.

According to the Complaint, the FBI investigation began in late 2005, when certain mortgage lenders became suspicious of the high foreclosure rate for NGF mortgages. As set forth in the Complaint, the object of the mortgage fraud conspiracy was to obtain money on credit with no intent to repay. The participants in the conspiracy repeatedly sold mortgaged properties among themselves, increasing the appraised value ( and thereby the size of each successive mortgage ) for a given property.

The Complaint alleges that securing false identities was a linchpin to the mortgage fraud scheme. According to the Complaint, identities were either purchased from Bangladeshi returning to Bangladesh, or created fictitiously. According to the Complaint, straw buyers were paid and assisted to purchase multiple properties and obtain multiple mortgages, and much of the information provided by the buyers in real estate closing documents was false.

According to the Complaint, buyers frequently falsified information about their employment, income, the homes they were purchasing, and whether the homes would be their principal residences.

The Complaint alleges that properties fraudulently purchased and mortgaged by the conspiracy were typically resold every year, and appreciated in value by roughly $100,000 on each sale. According to the Complaint, straw buyers are linked to multiple false identities, including at least five false identities for SADI, for example. The Complaint further alleges that straw buyers were typically paid about $5,000 per closing transaction.

The Complaint alleges that AHMED participated in three real estate closings as purchaser, using false documents in the name of "Abdul Rouf" or "Abdul Barek," including a bogus Pennsylvania driver's license that failed to contain the correct number of digits. The Complaint alleges that IQBAL took part in the fraudulent purchase and financing of five properties using the identity of a Mohammed Sajjad Hossain. According to the Complaint, ZUBAIR recruited JEWEL to assume the identity of "Wahid Chowdhury" for the purchase and financing of a property in Jamaica, Queens; and ZUBAIR recruited HASAN to pose as "MD Karim" for a mortgage on another Jamaica property.

The Complaint further alleges that ZUBAIR discussed plans to purchase twelve additional properties using straw buyers and false identities, and that ZUBAIR intended to use HASAN as straw purchaser in some of those prospective transactions.

According to the Complaint, in October 2006 TOGOR had arranged to pay KABIR roughly $100,000 for the use of his identity to buy properties. The Complaint further alleges that KABIR was directed by TOGOR to buy two properties in Jamaica, Queens, and that KABIR's identity was used by TOGOR's brother to purchase a Pennsylvania property.

According to the Complaint, SADI bought properties using false or fraudulent identities, including "Shah Iskander Khan" and "Debu Roy."

The Complaint further alleges that in March, ZUBAIR and MOHITUL transferred title to properties they controlled. According to the Complaint, ZUBAIR and MOHITUL believed title transfer was necessary to take advantage of the favorable terms to be negotiated with lending banks to satisfy the existing mortgages, retake control of the properties, and then resell them at a profit.

According to the Complaint, at the title transfer meeting attended by ZUBAIR, an undercover FBI employee and an unknown male, the unknown male was instructed by ZUBAIR to sign three different names in transferring five properties.

The Complaint further alleges that, at the similar meeting attended by MOHITUL, an unknown male was instructed by MOHITUL to sign six different names, transferring seven different properties.

The defendants are scheduled to appear before a U.S. Magistrate Judge in Brooklyn federal court later today.

Each defendant faces up to 30 years' imprisonment, a fine of up to $1,000,000, or both.

FBI Assistant Director MERSHON thanked the Federal Deposit Insurance Corporation, Office of Inspector General, for its assistance in the investigation.

Mohitul Islam, 43
Mohammed Zubair Hossain, 27
Lalon Ahmed, 50
Mohammed Jewel, 31
Mehdi Hasan, 42
Iqbal Hasan, 29
Humayun Kabir, 41
Togor ( LNU )
Golam Bahauddin Sadi
Mizanur Rahman

SOURCE: Federal Bureau of Investigation