2 Indicted for Persuading Lenders to Finance Sale Using Fake Documents

Allison Tussey —  May 14, 2014 — Leave a comment

Maximus A. Yaney, 37, and Jamie L. Bray, 36, both New York residents, were each indicted in Benton, Illinois, on one count of bank fraud and one count of wire fraud for their alleged roles in a mortgage fraud scheme wherein they used fake documents to persuade lenders to finance the sale of an apartment complex.

According to the Indictment filed on May 6, 2014, Yaney owned and operated various companies which purchased rental properties in college towns, including Carbondale, Illinois. Bray was the Vice President of Operations for Titan Student Communities, LLC, one of the companies owned by Yaney. The name of Titan Student Communities was later changed to Campus Habitat, LLC.

In June of 2007, Yaney used a company he had recently formed, known as H.G. Capital, LLC, to purchase the Marshall Reed Apartments, Carbondale, for $2,710,000. The Indictment further alleges that in November of 2007, Yaney caused H.G. Capital, LLC, to sell the Marshall Reed Apartments to another company that he owned, Titan, LLC, for $9,780,000. It is alleged that in obtaining both the short-term and long-term financing for this transaction, Yaney concealed from the lenders the fact that he had an ownership interest in both the selling and buying companies.

In order to persuade the lenders to finance the purported $9,780,000 sale, the Indictment charges that Yaney and Bray made several misrepresentations and engaged in numerous fraudulent acts, including, (1) submitting fraudulent Rent Rolls for the Marshall Reed Apartments; (2) creating false leases to support the fraudulent Rent Rolls; (3) submitting a fraudulent Operating Statement for the Marshall Reed Apartments; (4) submitting false information regarding the percentage of apartments that were rented; (5) staging empty apartments with items to make them appear to be occupied; (6) paying employees of one of Yaney’s companies to sit in unoccupied apartments and pretend to be renters while appraisals and bank inspections were being performed; and (7) providing false information about the number of apartments that had been renovated.

The Indictment also charges that during the appraisal process, Bray concealed her true identity and claimed to be a person named “Jamie Lewis.” Bray allegedly did this in order to
prevent the appraiser from learning that she worked for one of Yaney’s companies.

The Indictment states that on November 14, 2007, $6,123,342.81 in loan proceeds from the purported sale of the Marshall Reed Apartments were wire transferred to a bank account in the name of H.G. Capital. On the very next day, it is alleged that $6,123,300.06 of those funds were wire transferred to the account of Campus Habitat, one of other companies Yaney owned. The Indictment charges that Yaney then used those funds for operating expenses and to purchase other rental properties.

Each count of bank fraud and wire fraud is punishable by not more than 30 years in federal prison, and/or a $1,000,000 fine, and not more than five years of supervised release following the prison time. The Indictment also seeks forfeiture of the $6,123,342.81 in proceeds that Yaney received from the scheme.

United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced the charges.

The investigation is being conducted by agents from the Federal Bureau of Investigation and the Federal Housing Finance Agency – Office of the Inspector General. The case is being prosecuted by Assistant United States Attorney Scott A. Verseman.

Allison Tussey

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