On July 21, 2008, 5 defendants were charged in an eight-count Indictment for their participation in a mortgage fraud scheme that resulted in the issuance of more than $830,000 in mortgage loans:
Sixto Figueroa, 57, and his wife Susy Figueroa, 44, both of Miami, fraudulently sold residential lots in Port LaBelle, Florida. To effectuate their scheme, the Figueroas recruited individuals to pose as buyers of the properties. Among the straw buyers recruited and paid by the Figueroas were co-conspirators Rolando Herrera, 63, and Manuel Garcia, 40, both of Miami, Florda.
As part of the scheme, the Figueroas submitted fraudulent loan applications to Wachovia Bank. The applications contained false information regarding the straw buyers’ financial condition, including fraudulent tax returns and fabricated bank statements, which falsely suggested that the straw buyers had greater income and assets than they actually did. Additionally, the HUD-1 Settlement Statements provided to Wachovia falsely stated that the straw buyers would use their own money to pay closing obligations. In fact, however, the Figueroas paid all of the straw buyers’ closing obligations.
After the loans were approved, the bank wired the loan proceeds to defendant Yolanda Garcia-Montes‘s title company for closing. For three purported property sales, Garcia-Montes improperly released these funds to the Figueroas, who, in turn, used the money to pay the straw buyers’ cash to close obligations for those deals. After the closing, each of the Wachovia mortgage loans eventually went into default after the non-qualifying straw buyers failed to make the required mortgage payments, resulting in substantial losses to Wachovia.
Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, announced the indictment. The defendants were charged with conspiracy to commit bank fraud and bank fraud. Mr. Sloman commended the investigative efforts of the Federal State Mortgage Fraud Strike Force with special commendation to the United States Secret Service and Miami-Dade Police Department. The case is being prosecuted by Assistant U.S. Attorney Joseph B. Shumofsky.