12 Charged in 6 Mortgage Fraud Schemes

admin —  July 16, 2009 — 3 Comments

12 individuals have been charged in United States District Court in Pittsburgh, Pennsylvania, in connection with six separate mortgage fraud schemes:

John L. Chaffo, Jr., 49, Murrysville, Pennsylvania; Michael Dokmanovich, 36, Bethel Park, Pennsylvania; and Bernardo Katz, 49, Mt. Lebanon, Pennsylvania, have been charged in a 15—˜count Superseding Indictment with Wire Fraud, Wire Fraud Conspiracy and Bank Fraud.

According to the Superseding Indictment, Dokmanovich, who was a licensed mortgage broker, and Chaffo, who was an attorney, participated in two different mortgage fraud conspiracies involving the submission of fraudulent loan applications and other documents, including appraisals, in connection with loan applications. The Superseding Indictment also alleges that Bernardo Katz participated in one of those conspiracies.

The law provides for a maximum total sentence of 260 years in prison, a fine of $3,250,000, or both for Chaffo; 210 years in prison, a fine of $3,250,000, or both for Dokmanovich; and 130 years in prison, a fine of $2,250,000, or both for Katz.

Nicholas DeRosa, 64, New Castle, Pennsylvania, and Anthony J. Staph, Jr., 43, also of New Castle, have been charged in a four—˜count Superseding Indictment with Bank Fraud, Mail Fraud, and Money Laundering Conspiracy, and  with Bank Fraud.

According to the Superseding Indictment, DeRosa participated in a bank fraud scheme, and in a similar mail fraud scheme, in which he arranged for Affordable Housing of Lawrence County (AHLC) to purchase properties at prices in excess of their fair market values. The Superseding Indictment alleges that DeRosa caused the preparation and execution of fraudulent sales agreements related to properties that AHLC intended to purchase in that the sales agreements failed to disclose that some of the sellers intended to kick back to DeRosa money after the closing. The Superseding Indictment also alleges that Staph, who was an appraiser, prepared appraisals for properties that were to serve as collateral for AHLC’s loan from First Commonwealth Bank that he then knew were false and fraudulent in that they contained misrepresentations related to the value of the properties, the condition of the properties, and whether the properties were occupied.

The Superseding Indictment also alleges that DeRosa participated in a money laundering conspiracy in which a seller of one of the properties withdrew $5,000 in cash from a bank account to pay DeRosa a kickback, that some of the kickback funds were deposited into a bank account of an individual known to the grand jury, and then withdrawals were made from that account via checks made payable to an entity known to the grand jury.

The law provides for a maximum total sentence of 50 years in prison, a fine of $2,000,000, or both for DeRosa, and thirty 30 years in prison, a fine a $1,000,000, or both for Staph.

The United States Attorney filed a related, one—˜count Bill of Information charging Robert Ratkovich, 40, New Castle, Pennsylvania, with one count of Bank and Mail Fraud Conspiracy and one count of Money Laundering Conspiracy.

According to the Information, Affordable Housing of Lawrence County (AHLC) hired Ratkovich to provide consulting services related to the purchase of seven properties all of which were owned or associated with an individual known to the United States Attorney. The Information alleges that Ratkovich provided false information to First Commonwealth Bank in connection with a loan that was used to purchase the seven properties and caused AHLC to purchase the properties in excess of their fair market values.

The law provides for a maximum total sentence of 40 years in prison, a fine of $750,000, or both for Ratkovich. Senior United States District Judge Gustave Diamond will schedule a date for Ratkovich to enter a guilty plea.

A five—˜count Superseding Indictment charges Colleen Chiavetta, 36, and John Chiavetta, 70, both of McKees Rocks, Pennsylvania, with Wire Fraud Conspiracy, Money Laundering Conspiracy, and Tax Evasion in connection with a mortgage fraud scheme.

According to the Superseding Indictment presented to the Court, Colleen Chiavetta and another individual operated People’s Home Mortgage that assisted individuals to obtain loans collateralized by real estate. Colleen Chiavetta and other individuals allegedly submitted fraudulent loan applications and supporting documents that overstated the financial condition of the borrowers, including their income and assets. The supporting documents also overstated the true sales prices of the properties and included appraisals that overstated the true value of the properties. Some of the fraudulent loan applications were submitted on behalf of John Chiavetta.

The Superseding Indictment further alleges that Colleen Chiavetta participated in a money laundering conspiracy that used the proceeds of the mortgage fraud scheme to further that fraud and to conceal the proceeds of that fraud. In addition, the Superseding Indictment charges Colleen Chiavetta with tax evasion, and alleges that, among other things, Colleen Chiavetta failed to file her income tax returns for the 2004 through 2006 calender years.

The law provides for a maximum total sentence of 55 years in prison, a fine of $1,500,000, or both for Colleen Chiavetta, and 20 years in prison, a fine of $250,000, or both for John Chiavetta.

A one—˜count Indictment charges David McCloskey, 44, Finleyville, Pennsylvania, with Wire Fraud Conspiracy in connection with a mortgage fraud scheme.

According to the Indictment presented to the Court, McCloskey was a mortgage broker who operated a mortgage broker firm called First Atlantic Financial. He allegedly participated in a conspiracy to present fraudulent appraisals to mortgage lenders. The appraisals were fraudulent in that they overstated the true fair market values of the properties that served as collateral for the loans, and represented that they were prepared by licensed appraisers, when they were really prepared by an unlicensed appraiser.

The law provides for a maximum total sentence of 20 years in prison, a fine of $250,000, or both for McCloskey.

In addition, the grand jury returned a one—˜count Indictment charging Karen Atkison, 50, West Sunbury, Pennsylvania, with Wire Fraud Conspiracy in connection with a mortgage fraud scheme.

According to the Indictment presented to the Court, Atkisonwas employed by entities that closed real estate transactions. She allegedly participated in a conspiracy with a mortgage broker in which they submitted documents to lenders falsely representing that borrowers had made down payments in connection with the closings when, in fact, they had not made down payments. Rather, the Indictment alleges that Atkison, prior to the closings, forwarded funds to the mortgage broker, who converted those funds to cashier’s checks or certified checks that the broker then brought to the closing. All of that was done to make it falsely appear to the lenders that the borrowers made down payments at the closings.

The law provides for a maximum total sentence of 20 years in prison, a fine of $250,000, or both for Atkison.

Finally, the United States Attorney filed separate, but related, one—˜count Bills of Information charging Daniel W. O’Connor, 38, and Lawrence J. Kraynak, 40, both of Shaler, Pennsylvania, with Wire Fraud Conspiracy in connection with a mortgage fraud scheme.

The Bills of Information allege that O’Connor and Kraynak operated a mortgage broker company called Financial Freedom Mortgagethat assisted borrowers in obtaining loans collateralized by real estate. Each defendant participated in a conspiracy to defraud lenders by submitting to the lenders appraisals knowing that the appraisals vastly overstated the true fair market values of real estate that served as collateral for the loans. The appraisals were prepared by Kenneth Cowden, who was not licensed to prepare appraisals, who has pleaded guilty to similar charges, and who is awaiting sentencing. O’Connor and Kraynak are alleged to have submitted Cowden’s appraisals under the name of licensed appraisers as if they had been prepared by the licensed appraisers.

The law provides for a maximum total sentence of 20 years in prison, a fine of $250,000, or both for O’Connor and Kraynak. United States District Judge Joy Flowers Conti will schedule dates for both O’Connor and Kraynak to enter guilty pleas.

Mary Beth Buchanan, United States Attorney for the Western District of Pennsylvania, made the announcement.

In all cases an Indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.

Be Sociable, Share!

admin

Posts Google+

3 responses to 12 Charged in 6 Mortgage Fraud Schemes

  1. Guilty people should be punished. Not everyone on this list is guilty. This is a modern day witch hunt to find blame for the real estate collapse and to make this US Attorney look good for reappointment.

  2. David Jonhston July 17, 2009 at 9:25 am

    Its good that these people are gettig punishments for their wrong activities. I still thing that changes would be more strict.

    Hillsborough homes for sale

  3. David Jonhston July 17, 2009 at 9:23 am

    Its good that these people are gettig punishments for their wrong activities. I still thing that changes would be more strict.

Leave a Reply

Text formatting is available via select HTML.

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong> 

*