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The Mortgage Fraud Blog

The Mortgage Fraud Blog
A blog aimed at keeping readers informed of the latest developments in Mortgage and Real Estate Fraud and includes details of recent court cases, indictments, action by regulators and many other relevant topics

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Articles

Two arrested in New York real estate investment scheme allegations
2007-07-30 21:40:00
In the following press release MICHAEL J. GARCIA, United States Attorney for the Southern District of New York , and MARK J. MERSHON, Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today the arrests of Michael Hershkowitz and Ivy Woolf-Turk in connection with an elaborate scheme to defraud approximately 70 individuals of over $27 million. As alleged in the Complaint filed in Manhattan federal court:HERSHKOWITZ and WOOLF-TURK, working through a Manhattan real estate development company, The Kingsland Group, Inc., and related entities (collectively, “The Kingsland Group”), fraudulently induced approximately 70 individuals (the “Investor Victims”) to loan them, in the aggregate, over $27 million, purportedly to fund the renovation of approximately sixteen multi-family apartment buildings located in upper Manhattan. As part of the fraud, HERSHKOWITZ and WOOLF-TURK falsely represented that t...
More About: Arrested , Estate , Real Estate , Real Estate Investment

Princeton (Mass) attorney accused of theft in $6.2 scheme
2007-07-28 01:34:00
On July 24, 2007 a Criminal Information was filed in the Mass achusetts District Court alleging that attorney Alan Mason of Princeton , Mass had engaged in a scheme to defraud lenders by converting portions of loan proceeds for his own use. Mason was the owner of Alan Mason Legal Services, Inc of 428 Shrewsbury Street, Worcester, MA. He was an agent for Stewart Title and also bought and sold foreclosed properties. In the scheme Mason is alleged to have prepared false closing docs like HUD-1’s which showed that existent liens had been paid off using loan proceeds when in fact they had not. He allegedly sent copy checks and other documents which purported to prove the non-existent pay offs. He then issued Title Insurance policies knowing that the titles were defective because the liens had not been paid off. He then made regular monthly payments to the liens to avoid defaults and triggering alerts. During this scheme he is alleged to have defrauded at least 10 lenders of ove...
More About: Attorney , Theft , Atto

Two men indicted in Kansas mortgage fraud allegations
2007-07-28 01:02:00
In the following July 19, 2007 press release the United States Attorney for the District of Kansas announced that a grand jury had indicted Steve C. Middleton, 46, Overland Park, Kan., and Jared Minor, 36, Belton, Mo., who are charged with one count of conspiracy to commit bank fraud, four counts of bank fraud, three counts of money laundering and one count of criminal contempt of court. According to the indictment: Doing business as Somerset Homes, Middleton obtained loans and built homes in the greater Kansas City area. Minor was a construction contractor who worked with Middleton. As a result of fraud, Middleton received more than $1 million from Bank of the Prairie. On May 17, 2006, Middleton was indicted in another federal case. His co-defendants were F. Jeffrey Miller, Todd Earnshaw, Brian Rouse, Angela Parenza, Elizabeth Hessel, James Moser, and Lanny Ross. Middleton was released on bond after agreeing to comply with the court’s order prohibiting him from engaging i...
More About: Fraud , Mortgage Fraud , Mortgage , Indictments

Two men indicted in Montana fraud allegations
2007-07-28 00:52:00
On June 6, 2007 an indictment was filed in the Helena Division of the Mont ana District Court accusing Scott William Hilgers and Todd Jeremy Rice of a scheme to defraud mortgage lenders. Hilger was a mortgage broker working for Tri-West Mortgage in Helena, Montana and he is alleged to have falsified income and other details to enable Price to obtain 4 mortgage loans (see below) that he would not normally have qualified for and falsely represented that Price would occupy all four properties. The four mortgages totaled $686,000. The properties mentioned in the indictment are: 350 Woodson Rd., Helena, Montana 1560 Gallatin Ave., Helena, Montana 1306-1308 Poplar St., Helena. Montana 8560 Applegate Drive, Helena, Montana. Both men were arraigned on June 28, 2007 when they entered not guilty pleas. Their trials are set to proceed on August 13, 20007. Resources: Indictment
More About: Fraud , Indictments , Broker

Lee's Summit (MO) woman charged with ID Theft in relation to 3 mortgages
2007-07-25 21:30:00
In a press release earlier today John F. Wood, United States Attorney for the Western District of Missouri , announced today that a Lee’s Summit, Mo., woman has been indicted by a federal grand jury for a mortgage fraud scheme in which she used stolen identities to purchase homes. Kimberly M. Davis , 42, of Lee’s Summit, was charged in a 14-count indictment returned Tuesday, July 24, 2007, by a federal grand jury in Kansas City. The federal indictment alleges that Davis used the names, Social Security numbers and birth dates of three separate victims, without their permission, to purchase two homes in Lee’s Summit. Davis is charged with eight counts of wire fraud, one count of mail fraud and five counts of aggravated identity theft. According to the indictment, Davis worked as a mortgage broker at firms in Liberty and Gladstone from November 2003 through January 2005. Between Nov. 19 and 25, 2003, Davis allegedly used a stolen identity to obtain loans to...
More About: Woman , Indictments , Mortgages , Theft

Attorney indicted, accused of Grand Larceny, in Nassau County
2007-07-24 21:46:00
In a press release Nassau County District Attorney Kathleen Rice announced this morning the arrests of an attorney in connection with separate thefts of more than $900,000. Barry Chasky , 54, of Point Lookout, who has been charged with Grand Larceny in the Second Degree, after allegedly embezzling nearly $900,000 from the escrow accounts of First American Title Insurance Company. Chasky will be arraigned later today in First District Court, Hempstead. Mr. Chasky and Mr. Corrado face maximum sentences of 15 and seven years in prison, respectively, if convicted of the charges.“Attorneys have more than just a professional responsibility to represent their clients’ interests,” said Rice. “These are professionals working in a position of trust, very often for clients who are not familiar with the law and may be going through an incredibly difficult episode in their lives. We will be very aggressive in going after professionals violating this trust and preying upon...
More About: New York , Indictments

2nd attorney indicted in Nassau County
2007-07-24 21:42:00
In the second case announced today by Nassau County District Atto rney Kathleen Rice it was announced that Joseph Corrado, 48, of Pleasantville, has also been charged with Grand Larceny in the Third Degree, in connection with an alleged theft from the escrow account of a Garden City client who hired the defendant to negotiate a loan refinancing. Joseph Corrado was hired in January 2005 to negotiate a loan modification for a Garden City homeowner who had stopped paying his mortgage bill in 2002. The homeowner gave Mr. Corrado a total of $35,000.00 to hold in escrow during the negotiations. Bank One, the mortgagor of the property, foreclosed on the home and it was ultimately sold at auction July 19, 2006. Mr. Corrado is alleged to have pocketed the money, doing little more than filing a notice of appeal during the process. To date, Mr. Corrado has returned only $4,000, creating a financial loss of $31,000 to the client. Assistant District Attorney Vickie Curran, of the District Attorne...
More About: New York , Indictments

5 indicted in Florida mortgage fraud allegations
2007-07-19 17:40:00
In the ffollowing press release the Florida Department of Law Enforcement announced that a three-year joint investigation by the Tampa Police Department (TPD), Hillsborough County Consumer Protection Agency (HCCPA), Pinellas County Department of Justice and Consumer Services (PCDJCS), Florida Attorney General’s Office of Statewide Prosecution (OSWP), and the Florida Department of Law Enforcement (FDLE) has led to the arrests of five defendants charged with racketeering, conspiracy to commit racketeering, obtaining of a mortgage by false representation, and second-degree grand theft by fraudulently obtaining mortgages in the names of victims solicited for home improvement projects and for obtaining fraudulent loans on their own personal properties. The individuals arrested include Scott Almeida, Orson Benn, Adrienne White, Frank Giffone, and Samuel Green. “The allegations brought against these individuals are unspeakable. To prey on the hopes and dr...
More About: Fraud , Mortgage Fraud , Mortgage , Indictments

Mortgage broker pleads guilty in $2.5 million fraud
2007-07-19 02:01:00
According to Court Records on July 2, 2007 mortgage broker Ronald Clark Joseph of Prior Lake, MN entered a guilty plea to a 7 count indictment alleging Wire and Mail fraud along with Money Laundering. The indictment, filed on March 13, 2007, alleges that Joseph falsified the sales price of properties and then concealed payments to be made to him from the subsequent loan proceeds. At closing the closing agent provided falsified documents which concealed payments to the buyer and Joseph. In two cases Joseph himself is alleged to have acted as the purchaser and netted $200,000 from the concealed payments. In all some 40 different properties were involved and Joseph received $2.5 million from them. A sentencing date is yet to be filed in the court records. Resources:IndictmentOriginal Entry on this blog
More About: Fraud , Mortgage , Broker , Million , Guilty

Man sentenced in drug money laundering case involving broker and lawyer
2007-07-18 22:47:00
In the following press release the Jeffrey C. Sullivan, United States Attorney for the District of Western District of Washington announced that JOSHUA MACKE, 35, of Bellevue, Washington has been sentenced in U.S. District Court in Seattle to six years in prison, and three years of supervised release for Conspiracy to Distribute Marijuana and Conspiracy to Engage in Money Laundering. As part of his plea agreement of March 24, 2007, MACKE will forfeit to the government three late model vehicles, nearly $1 million in currency and investments, and his home. At sentencing U.S. District Judge Ricardo Martinez noted “this was an extensive organization with large amounts of illegal drugs and money.” MACKE was arrested in May 2006, following an investigation of his drug trafficking activities. MACKE was distributing pound quantities of B.C. Bud marijuana in the Seattle area. The marijuana was being transported into Washington State from Canada. MACKE was one of some 40 defendant...
More About: Lawyer , Convictions , Case , Drug

Two former care home owners indicted over theft of proceeds from house sale
2007-07-18 22:27:00
In the following press release the New York Attorney General, Andrew M. Cuomo announced the arrests of the former operators of Welcome Home , a Beaver Dams “Family Type Home” for adults, who allegedly used the credit cards, bank accounts and identities of their residents, one of whom was receiving hospice care, to acquire a swimming pool, a tractor and cash. Harry Smith, 46, and his wife, Christine Smith, age 40, of 1425 Roloson Hollow Road in Beaver Dams, were charged with Grand Larceny in the Third Degree for stealing thousands of dollars from two elderly residents of the home. In addition, Harry Smith was charged with Grand Larceny in the Third Degree, Forgery in the Second Degree, Criminal Possession of a Forged Instrument in the Second Degree and Identity Theft in the First Degree for falsely using the identity and credit of one of the residents to purchase a tractor. Each of the crimes charged are class “D” felonies, which carry a maximum prison term of ...
More About: House , Sale , Care

4 indicted in Louisville, KY mortgage fraud allegations
2007-07-16 18:36:00
In the following press release U.S. Attorney David L. Huber of the Western District of Kentucky announced that a federal grand jury in Louisville returned an indictment against Edward “Ted” House, of Louisville, Kentucky; Nathan Frisbie, of Louisville, Kentucky; Khaliad Raheem, a/k/a Dwayne Cross, of Louisville, Kentucky; and Jerry Crenshaw, of Louisville, Kentucky, with conspiracy to commit wire fraud and bank fraud.The Indictment alleges that between January 1, 2000, and May 30, 2003, House, Frisbie, Raheem, and Crenshaw conspired with one another to defraud two residential mortgage lenders. The indictment identifies 24 separate fraudulent loan transactions, totaling approximately $1.5 million, in which the named defendants participated. The defendants defrauded the mortgage lenders through various means. Generally, they provided the lenders with false borrower background information in order to fraudulently induce the funding of individual loans. The defendants would ...
More About: Fraud , Mortgage Fraud , Mortgage , Indictments

Appraiser indicted in Pennsylvania fraud allegations
2007-07-16 18:08:00
In the following May 1, 2007 press release Thomas A. Marino, United States Attorney for the Middle District of Penn sylvania , announced that a Kingston man was arrested Monday by agents of the Federal Bureau of Investigation and Kingston Police on a federal charge of mail fraud related to making false and fraudulent mortgage and loan appraisals during a four-year time period. Marino stated that Richard Woods, age 51, was charged in an indictment returned by a federal grand jury on March 20, 2007, with using the mail to further a scheme in which false real estate appraisals were used to qualify customers for inflated mortgages. The indictment states that Woods provided false real estate appraisals to Four Star Mortgage Services, First Advantage Financial Corporation, and other companies during 1999-2003. Woods’ charge stems from a lengthy investigation by the Federal Bureau of Investigation. Marino noted that if Woods is convicted of the mail fraud charge, he faces a possible ma...
More About: Fraud , Sylva

North Carolina AG "shuts down" foreclosure rescue operation
2007-07-16 18:08:00
In the following press release North Carolina Attorney General Roy Cooper today announced the end to a scheme by a Charlotte company that promised to buy homes from people who needed to sell quickly but instead left them vulnerable to foreclosure.“This scam hurt both homeowners and people who hoped to become homeowners,” said Cooper. “We’ve put a stop to their phony ‘We Buy Homes’ promises so no more consumers will be caught up in this scheme.”Under a consent judgment approved today by Wake County Superior Court Judge Kenneth Titus, Cooper has put a stop to a scheme by Charlotte Home Solutions and its manager William Keaton that purported to buy homes and then resell them to buyers with poor credit. Keaton is barred from operating this “We Buy Homes” scam and must pay the state $100,000 if he fails to comply with today’s judgment. Cooper previously won a consent judgment against Keaton’s partner Steven Huff in May. Hu...
More About: Foreclosure , Rescue

3 indicted in ID Theft and bogus house sale allegations
2007-07-16 18:03:00
In the following press release Michael J. Sullivan, United States Attorney for the District of Massachusetts announced that a man and two women were charged today in federal court with Conspiracy and Identity Fraud for fraudulently obtaining mortgage financing in connection with the fictitious sale of a Dorchester residence that they did not own.United States Attorney Michael J. Sullivan, Warren T. Bamford, was joined in the announcement by Special Agent in Charge of the Federal Bureau of Investigations New England Field Division, Daniel Conley, Suffolk County District Attorney, Joanne Yarbrough, Acting Inspector in Charge of the U.S. Postal Inspection Services, Douglas A. Bricker, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation - Boston Field Office, Steven Ricciardi, Special Agent in Charge of the U.S. Secret Service, Colonel Mark Delaney, Superintendent of the Massachusetts State Police and Edward Davis, Boston Police Commissioner.ANDRE LAMERIQUE, ...
More About: House , Sale , Indictments , Theft

Former Mayor of Newark indicted in flipping and credit card fraud allegatio
2007-07-13 20:35:00
In the following press release New Jersey U.S. Attorney Christopher J. Christie and State Attorney General Anne Milgram announced that former Newark Mayor Sharpe James was charged in an Indictment today with using city-issued credit cards to spend lavishly on himself, eight female companions and others during personal trips and vacations to such places as Martha’s Vineyard, Rio de Janeiro, the Dominican Republic and Puerto Rico,. The Indictment also charges James in a second fraud against the citizens of Newark in which he allegedly facilitated and approved the drastically cut-rate sale of city-owned land to Tamika Riley, one of his companions, who fraudulently reaped hundreds of thousands of dollars from the sales. She too is charged with this fraud in the Indictment. Following the Indictment’s return, James, 71, surrendered voluntarily to Special Agents of the FBI and was scheduled to make an initial appearance in federal court. Riley, 38, was arrested by the FBI and w...
More About: Credit Card Fraud , Card , Credit , Fraud

Monterey (CA) man ordered to pay $100,000 in civil fraud prosecution
2007-07-13 00:37:00
Monterey County District Attorney Dean Flippo announced today that his Consumer Protection Unit has obtained a civil judgment in a real estate fraud investigation involving local business owner Robert Janssen and his company Abbey Management, Inc. The judgment concludes the District Attorney’s investigation of the defendants’ role in advertising, marketing and providing services in selling real estate without California licensure. While defendants did not admit liability in agreeing to the judgment, they will pay $100,000 in penalties and victim restitution for their role in the sale of a single Salinas home last August 2006. According to the District Attorney’s civil complaint, the defendants engaged in false advertising and fraudulent business practices in the provision of real estate services and auction sales. On and after October 1, 2005, defendants Robert Janssen and Abbey Management, Inc. (d.b.a. Abbey Properties) represented themselves to be real esta...
More About: Fraud , Order , Civil , Monterey

Recent Case Updates
2007-07-12 23:43:00
The following entries were updated today.Former USC Professor sentenced to prison.Florida habitual offender given 10 years in prison following guilty plea to mortgage fraudMan pleads guilty in Troy mortgage fraud case.Attorney who stole from her aunt gets 1 to 3 years
More About: Updates , Case , Recent

Brooklyn Attorney indicted in Lipkin et al mortgage fraud case
2007-07-12 23:15:00
The United States Attorney for Southern New York today announced the arrest of Alexander Kaplan, a Brooklyn attorney, in a complaint related to the superseding indictment issued yesterday against Lipkin and 25 other defendantsPlease click here for more detail
More About: Fraud , Mortgage Fraud , Mortgage

Superseding indictment issued in Lipkin and others case
2007-07-12 22:57:00
The United States Attorney for the Southern District of New York has filed a superceding indictment in the sub-prime mortgage fraud case it reported earlier this year.Please click here to read the full article.
More About: Indictments , Flipping , Case , Indictment

Three indicted by Manhattan DA in real estate investment scam
2007-07-12 20:50:00
In the following press release Manhattan District Attorney Robert M. Morgenthau announced today the grand larceny and securities fraud indictment of two California women who stole over $1,600,000 from investors largely from the New York area. A Brooklyn woman has also been indicted for securities fraud and scheme to defraud for fraudulently inducing her clients and others to invest with the California women. The indictment charges that between 2005 and 2006, CARLA ZIMBALIST and PAM CHANLA, also known as SAYASITH KHAMMANIVONG, sole partners in CPM HOLDINGS INC., PMC INTERESTS, INC., AND SCOTT AVENUE DEVELOPMENT, INC., stole money from twenty-three investors. ZIMBALIST and CHANLA found these investors through JENNIFER WILKOV, who at the time was a financial advisor at American Express Financial Advisors. WILKOV used her position to solicit her clients and others for this investment. All three defendants told investors that ZIMBALIST and CHANLA would use their investments to purchase a...
More About: Estate , Real Estate , Real Estate Investment , Investment

Illinois real estate agent indicted in HUD mortgage fraud case
2007-07-10 01:03:00
In the following press release Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois ; Robert D. Grant, Special Agent -In-Charge of the Chicago Office of the Federal Bureau of Investigation; and Barry McLaughlin, Special Agent-In-Charge of the Chicago Field Office of the Department of Housing and Urban Development – Office of the Inspector General (“HUD-OIG”), today made the following announcement: A federal grand jury in Rockford today returned a 10-count indictment charging Rockford real estate agent RAYMOND S. TALAN, (pictured left) 41, Caledonia, Illinois, with mortgage fraud. Specifically, the indictment alleges that Talan conducted a scheme to defraud commercial lenders and HUD by causing unqualified loan applicants to receive commercial and Federal Housing Administration (“FHA”) insured loans. (Picture from Rockford Re-Max website)According to the indictment, to be eligible to receive an FHA insured loan, a ...
More About: Estate , Fraud , Real Estate

Recent case updates
2007-07-09 21:41:00
The following entry was updated todayFlorida attorney pleads no contest - to be sentenced in August
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Georgia DBF issued cease and desist order - alleges misreps in loan files
2007-07-06 23:15:00
In the following press release The Georgia Department of Banking and Finance announced that o n July 4, 2007 the Department’s Order to Cease and Desist issued to Roosevelt Toe of Buford, Georgia, became final. Mr. Toe was issued an Order to Cease and Desist by the Department for making misrepresentations in loan files submitted to mortgage lenders.Pursuant to state law that was in effect when the violations underlying the Order to Cease and Desist were committed, the Department may revoke the license of a mortgage broker or lender that employs an individual against whom a final Order to Cease and Desist has been issued within the preceding three years if the Order resulted from misrepresentations being made in loan documents.A copy of the Order to Cease and Desist issued to Mr. Toe can be accessed here.
More About: Loan , Files , Ease

Recent case updates
2007-07-03 21:37:00
The following entries were updated today:Guilty plea in $64 million real estate Ponzi scheme
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Man charged in relation to attempts to obtain home from missing companion
2007-07-03 00:29:00
In the following press release U.S. Attorney (New Jersey ) Christopher J. Christie announced that a Plainfield man under suspicion in the disappearance and death of his former companion was arrested today on charges of attempting to defraud him of his estate, including his home, life insurance and retirement savings.The victim, Nicholas Queune, 52, of Plainfield, has not been seen since his departure on a trip to Pakistan with the suspect, Khawar Gardazi, 31. Upon his return to the United States, Gardazi reported that Queune had died of a heart attack in Pakistan and that Queune’s body had been cremated . Gardazi then allegedly presented a dubious Pakistani death certificate to a New Jersey attorney in an attempt to probate Queune’s will, in which he was designated the sole beneficiary, according to a criminal Complaint unsealed today. Subsequently, Gardazi told a brother of the victim that, during an argument in Pakistan, he shoved Queune, who fell, hit hi...
More About: Home , Indictments , Missing , Relation

Snap Shot Visual Links installed
2007-07-02 22:03:00
We have installed a new tool on this site called Snap Shot s that enhances links with a visual preview of the destination site , interactive excerpts of Wikipedia articles and other internet tools, as well as displaying inline videos , RSS , MP3s , photos , stock charts and more . Wherever you see a small “speach bubble icon” move your cursor over it and a snap shot of the page the link is directed to will appear. Sometimes Snap Shots will bring you the information you need, without your having to leave the site, while other times it lets you “look ahead,” before deciding if you want to follow a link or not. Should you decide this is not for you, just click the Options icon in the upper right corner of the Snap Shot and opt-out.
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Case Updates
2007-07-02 20:05:00
The following entries were updated today.Court of Appeal (Sixth Circuit) upholds conviction of Pastor in mortgage fraud case.
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