Former sales manager of NY brokerage sentenced in mortgage fraud scheme

Preet Bharara, the United States Attorney for the Southern District of New York, announced that Erin Davis, former sales manager for the now defunct Buy-A-Home real estate brokerage business, was sentenced today in Manhattan federal court to 24 months in prison for participating in a multi-million dollar mortgage fraud scheme. DAVIS and Buy-A-Home’s owner, Mitchell Cohen, were indicted in July 2012. DAVIS pled guilty in January 2013 to one count of conspiracy to commit mail, wire and bank fraud, and was sentenced today before U.S. District Judge Denise L. Cote.

Manhattan U.S. Attorney Preet Bharara stated: “At the ground level of the mortgage crisis were people like Erin Davis, a top manager at Buy-A-Home, who orchestrated falsehoods and moved money around to generate millions of dollars of fraudulently obtained mortgages. This Office remains committed to using every legal means available to hold to account those who helped contribute to the home mortgage crisis and to FHA’s dire financial straits.”

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Moreno Valley man arraigned on real estate document forgery charges

In the following press release the San Bernadino County District Attorney accounced that a Moreno Valley man suspected of committing real estate fraud was arraigned last week on multiple counts of Forgery and Procuring and Offering False or Forged Instrument. Stefan Mahaley, 52, is suspected of forging and filing several fraudulent real estate documents at the San Bernardino County Recorder’s Office, which is a felony offense in the State of California.

“During the course of our investigation, it was discovered that Mr. Mahaley had purchased a home in the City of Fontana, which eventually went into foreclosure and was sold to a new buyer through a public auction,” said Senior Investigator Jaime Samaniego, who is assigned to the case.

According to Samaniego, after the sale was complete, the defendant allegedly filed fraudulent documents granting the property back to him in an attempt to reclaim the home.

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Two Louisiana men sentenced in short sale mortgage fraud

United States Attorney Stephanie A. Finley announced today that Scott Rister, 43, of Shreveport, and William Clay Goodwin, 43, of Bossier City, were sentenced by U.S. District Judge Elizabeth E. Foote, to serve six months in prison and two years of supervised release for mail fraud.  The judge also ordered them to pay $8,150 in restitution to victims of the scheme.
According to evidence presented at the guilty plea, Rister and Goodwin worked together to arrange short sales of residential real estate in the Shreveport/Bossier area. They identified residential property owners whose homes were scheduled for foreclosure or in bankruptcy.  Rister offered to arrange short sales for their homes and informed them that Goodwin would attempt to negotiate with the financial institution that held the mortgage to settle the outstanding mortgage.  Rister also told the home owners that the home owners would not see a profit from the short sales, and added that Rister and Goodwin’s only compensation was a broker’s commission, which was typically 5 to 6 percent of the sales price.  However, Rister and Goodwin included fees and liens on the HUD-1 settlement statements without the home owners’ knowledge, permission or consent.  The fees and liens were listed in favor of LLCs created and owned by Rister and Goodwin.

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Texas man who claimed to be a pastor indicted on real estate investment fraud charges

Samuel Ray Palasota, 52, of Houston, has surrendered to federal authorities following the return of a 24-count indictment alleging he operated a fraudulent real estate investment scheme and defrauded a woman of $650,000, United States Attorney Kenneth Magidson announced today.

The sealed indictment, returned May 8, 2013, and unsealed today, charges Palasota with 21 counts of mail fraud and three counts of wire fraud. Palasota is expected to appear before U.S. Magistrate Judge Nancy Johnson at 2:00 p.m. today.

According to the indictment, Palasota held himself out as a pastor and also claimed to manage a real estate investment program, doing business under the name “The Maker’s Resources.” From in or about December 2008 through approximately December 2009, Palasota knowingly devised and intended to devise a scheme and artifice to defraud by means of material false pretenses, representations, and promises, the indictment alleges. Specifically, Palasota allegedly convinced a Mississippi woman to invest her money with him in an alleged real estate investment. However, instead of investing in real estate, Palasota stole her money, according to the indictment.

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President of First Class Equities sentenced in massive NY mortgage fraud

Preet Bharara, the United States Attorney for the Southern District of New York, announced that Gerard Canino, the president and owner of First Class Equities (“FCE”), was sentenced today in Manhattan federal court to 97 months in prison for his participation in a $66 million mortgage fraud scheme. Canino pled guilty in April 2012 to conspiracy to commit wire fraud and bank fraud in connection with the scheme, and was sentenced by U.S. District Judge Robert P. Patterson.

Manhattan U.S. Attorney Preet Bharara said: “With his sentence today, Gerard Canino, the architect of an elaborate house of cards that worked a fraud on lenders and homeowners, begins to pay the price for his scheme. Mortgage finance professionals have a duty to safeguard the integrity of their industry, not orchestrate phony schemes that leave a trail of foreclosed properties and other losses when the sham structure collapses.”

The above picture of one of the defendants under arrest is courtesy of Kevin Hagen and NY Daily News.

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Akron (OH) man sentenced, ordered to repay $15 million in two mortgage fraud schemes

An Akron man was sentenced to more than three years in prison and ordered to pay more than $15 million in restitution for his role in a mortgage fraud scheme in Florida and a separate scheme to defraud two elderly investors, said [press release] Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.  Andrew D. Norman, 36, previously pleaded guilty to conspiracy to commit bank fraud, conspiracy to commit wire fraud and filing a false tax return.

Norman and his business partner Jason Herceg conspired with Jack Coppenger in procuring “straw buyers” and submitting false loan documents to banks to purchase Coppenger’s lots in Florida (which had already been inflated in value as part of a land flip) in a mortgage fraud scheme.  Coppenger, with assistance from Norman and Herceg, perpetrated a large mortgage fraud scheme involving numerous straw buyers, who essentially sold their good credit score to Coppenger, in order for him to secure loans, through straw buyers’ names, for property in Florida, according to court documents. 

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Miami-Dade woman pleads guilty in $2.4 million short sale scam. 

In the following press release the Miami-Dade Inspector General’s Office announced that Zoraida Abreu (Abreu), who was arrested in February 2012 with three other co-defendants, pled guilty today for her part in a real estate scam that snared 15 victims and defrauded them of over $2.4 million. Abreu pled guilty to eight felony charges that included Racketeering, First Degree Grand Theft, and Second Degree Grand Theft. Abreu was sentenced to 15 years probation. Her sentence includes cooperation with prosecutors in the continuing prosecution of her three co-defendants. She will also be responsible for making restitution payments and paying costs of investigation.

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Connecticut man pleads guilty to conspiracy to commit babk (mortgage) fraud

Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that Daniel Monteiro, 34, of Wolcott, waived his right to indictment and pleaded guilty today before United States Magistrate Judge Donna F. Martinez in Hartford to one count of conspiracy to commit bank fraud, wire fraud, and money laundering stemming from a mortgage fraud scheme.

According to court documents and statements made in court, from approximately May to October 2007, Monterio conspired with others to obtain residential mortgages through the use of false down payments and hidden referral fees. As part of the scheme, Monterio referred individuals to a co-conspirator who had purchased numerous residential real estate properties, many through the use of a private lender. The individuals Monterio referred were then identified on mortgage documents as having purchased properties from Monterio’s co-conspirator. However, the co-conspirator purchased the bank checks that were used as down payments for each of the transactions. The co-conspirator used money obtained from the mortgages to pay private lenders and, on some occasions, referral fees to Monterio.

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