Vera Kuzmenko, Nadia Kuzmenko, Aaron New, Vanik Atoyan, Peter Kuzmenko, Sergey Blizenko, Veniamin Markevich, and Edward Shevtsov, Sacramento, California, have ben arraigned following their arrests in an eight-defendant federal mortgage fraud case involving losses alleged to exceed $9 million. The indictment, returned Thursday, May 12, 2011, by a federal grand jury in Sacramento, charges the defendants with wire fraud and mail fraud in connection with an alleged mortgage fraud scheme involving multiple properties in the Sacramento area that operated between late 2006 and late 2007. The indictment alleges that the defendants were responsible for originating more than $16.3 million in residential mortgage loans on 14 homes purchased through straw buyers. All of the homes went into foreclosure, causing losses of approximately $9.6 million.
According to court documents, defendant Vera Kuzmenko and her sister Nadia Kuzmenko were licensed real estate sales persons who allegedly recruited straw buyers with the assistance of Vanik Atoyan and other defendants. Defendant Aaron New was a licensed real estate broker. According to the indictment, the Kuzmenko sisters and others then prepared loan applications containing materially false information as to the straw buyers’ income, employment, assets and liabilities, and intent to occupy the residences, and defendant Aaron New presented the fraudulent applications to lending institutions. Defendants Veniamin Markevich, Edward Shevtsov, Peter Kuzmenko and Sergey Blizenko are alleged to have created shell companies, or used companies that had no connection with the properties, for use in submitting invoices to falsely claim they had made repairs to the properties. They then received payments from escrow to which they were not entitled.
Defendants Vera Kuzmenko, Aaron New, Peter Kuzmenko, Sergey Blizenko, Veniamin Markevich, and Edward Shevtsov, are also charged with money laundering. Vera and Nadia Kuzmenko are also charged with witness tampering.
Defendants Vera Kuzmenko, Nadia Kuzmenko and Vanik Atoyan were arraigned before U.S. Magistrate Judge Dale A. Drozd. The other defendants were arraigned yesterday and Friday. Defendants Vera Kuzmenko, Edward Shevtsov, and Peter Kuzmenko have been ordered detained pending further proceedings. Other defendants have been released on bail.
United States Attorney Benjamin B. Wagner announced the arrests.
The case is the product of an investigation by the FBI and IRS-Criminal Investigation. Assistant U.S. Attorney R. Steven Lapham is prosecuting the case.
This law enforcement action is part of the work being done by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. One component of the FFETF is the national Mortgage Fraud Working Group, co-chaired by U.S. Attorney Wagner, which is tasked with combating mortgage fraud schemes. For more information on the task force, visit StopFraud.gov.