Michael Arroyo, 60, Bronx, New York, and Rafael Popoteur, 67, Ridgefield Park, New Jersey,  a New York real estate broker and a Bergen County, New Jersey, homeowner were sentenced today for their respective roles in a $3.5 million scheme to use false information and simultaneous loan applications at multiple banks to fraudulently obtain home equity lines of credit, a practice known as “shotgunning”.

According to documents filed in the case and statements made in court:

From 2012 through January 2014, Arroyo and others conspired to fraudulently obtain multiple home equity lines of credit (HELOCs) from banks on residential properties in New Jersey and New York, including a residential property on Havermeyer Avenue, Bronx, New York. In 2013, Arroyo and others transferred ownership of the property to an individual living at the property and his family friend.

Arroyo and others then applied, in the family friend’s name, for two HELOCs from two banks using the Havermeyer Avenue property as collateral. They hid from the lenders the fact that the property was either already subject to senior liens that had not yet been recorded, or that the same property was offered as collateral for a line of credit from another lender. The applications also falsely inflated the family friend’s income without his knowledge. In addition, the equity in the property was far less than the amount of the HELOC loans that Arroyo and others applied for.

The victim banks eventually issued loans to the family friend in excess of $500,000. After the victim banks deposited money into the family friend’s bank accounts, portions of the funds were disbursed to Arroyo and others. Eventually, the family friend defaulted on the two HELOC loans.

Popoteur was a client of Arroyo and another broker. From 2012 through January 2014, Popoteur and the two real estate brokers, and others, conspired to fraudulently obtain multiple HELOCs from banks on a residential property in New Jersey. To get the banks to extend lines of credit they would not have otherwise approved, Popoteur and the real estate brokers executed a quitclaim deed to transfer ownership of a Ridgefield Park, New Jersey property to Popoteur, who also lived at the property.

Popoteur and the real estate brokers then applied for three HELOCs from multiple banks using the Ridgefield Park, New Jersey property as collateral. As the conspirators had done previously, they hid from the lenders the fact that the properties offered as collateral were either already subject to senior liens that had not yet been recorded, or that the same property was offered as collateral for a line of credit from another lender. The applications also contained false information concerning Popoteur’s income, which was stated to be higher than his actual income.  At the time the applications were made, the value of the Ridgefield Park, New Jersey property that was unencumbered by a mortgage was far less than the amount of the HELOC loans Popoteur and the others applied for.

The victim banks eventually issued loans to Popoteur in excess of $495,000.  After the victim banks funded the HELOCs and deposited money into Popoteur’s bank accounts, Popoteur disbursed portions of it to the real estate brokers and others. In 2014, Popoteur defaulted on all three HELOC loans. http://www.mortgagefraudblog.com/?s=Rafael+Popoteur

The overall scheme resulted in $3.5 million in losses to the victim banks.

Arroyo was sentenced to 21 months in prison. He previously pleaded guilty before U.S. District Judge John Michael Vazquez in Newark federal court to an information charging him with conspiracy to commit bank fraud.

Popoteur was sentenced to three years of supervised release, including one year of house arrest. He previously pleaded guilty before Judge Vazquez to an information charging him with conspiracy to commit bank fraud.

In addition to the prison term, Judge Vazquez sentenced Arroyo five years of supervised release.

U.S. Attorney Craig Carpenito made the announcement.

U.S. Attorney Carpenito credited special agents of the Federal Housing Finance Agency (FHFA) Office of Inspector General, under the direction of Special Agent in Charge Steven Perez in Newark, and special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation leading to today’s sentencings.

The government is represented by Assistant U.S. Attorney Jason S. Gould of the U.S. Attorney’s Office Criminal Division in Newark and Special Assistant U.S. Attorney Kevin DiGregory of the FHFA, Office of the Inspector General.

 

IRVINE, Calif.–(BUSINESS WIRE)–CoreLogic® (NYSE: CLGX), a leading global property information, analytics and data-enabled solutions provider, today released its latest Mortgage Fraud Report. The report shows a 12.4 percent year-over-year increase in fraud risk at the end of the second quarter, as measured by the CoreLogic Mortgage Application Fraud Risk Index.

Source: CoreLogic Reports a 12.4 Percent Year-over-Year Increase in Mortgage Fraud Risk for the Second Quarter of 2018 | Business Wire

David Lyle Morgan, 53, Tamp, Florida has pleaded guilty to one count of bankruptcy fraud.

According to the plea agreement, Morgan was a licensed realtor who entered into a contract with a homeowner to sell a property in foreclosure. In order to prevent the Federal National Mortgage Association (commonly known as Fannie Mae) from lawfully foreclosing on the homeowner’s property, Morgan devised and executed a bankruptcy fraud scheme wherein he filed a fraudulent bankruptcy petition in the name of the homeowner, without the homeowner’s knowledge or consent, just prior to the scheduled foreclosure sale date. The fraudulent bankruptcy invoked the automatic stay provision of the bankruptcy code, which prevented Fannie Mae from conducting the foreclosure sale and obtaining title to the property. http://www.mortgagefraudblog.com/?s=David+Lyle+Morgan

The fraudulent bankruptcy petition filed by Morgan allowed him to continue efforts to sell the property in order to obtain ill-gotten real estate commissions.

He faces a maximum penalty of five years in federal prison. A sentencing date has not yet been set.

This case was investigated by the Federal Housing Finance Agency – Office of Inspector General. It is being prosecuted by Special Assistant United States Attorney Chris Poor.

Advocate Law Groups of Florida, P.A., Jon B. Lindeman, Jr., and Ephigenia K. Lindeman, Florida were charged today for violating the Fair Housing Act by targeting Hispanic homeowners in a predatory mortgage modification scheme that increased, rather than decreased, their risk of foreclosure.

The radio and television commercials seemed too good to be true; promising Hispanic homeowners to cut their mortgage payments in half, even offering $500 gift cards to entice them to sign up for loan modification assistance.  The defendants were targeting Hispanic families through a deceptive advertising campaign that aired on Spanish-language radio and television stations throughout Florida.

U.S. Department of Housing and Urban Development (HUD) made the announcement.

HUD’s charge, filed on behalf of three Orlando-area Hispanic families, alleges that at initial client meetings, Spanish-speaking ALG employees made false promises to entice families into paying significant upfront fees and to sign contracts that were predominantly, if not entirely, written in English.  After being retained, ALG knowingly placed their clients’ homes at imminent risk of foreclosure by instructing homeowners to stop making mortgage payments and to cease communicating with their mortgage lenders or servicers. Read HUD’s charge

In addition, HUD’s charge alleges that ALG neglected their clients’ cases and ignored bank requests for information. When homeowners complained about their mistreatment, ALG threatened them with increased mortgage payments, fines, or foreclosure if they sought to terminate their relationship.  ALG ultimately failed to obtain favorable mortgage modifications for their clients, while charging them thousands of dollars in up-front and recurring monthly fees.

The Fair Housing Act prohibits discrimination because of national origin in housing and housing related services, including home mortgage and loan modification services.  This includes targeting persons because of their national origin for fraudulent modification services.

As we peeled back the facts of this case, we were stunned by a business model built to target Hispanic homeowners,” said Anna María Farías, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity.  “HUD will use the full weight of the law to protect families from those who would prey upon them because of where they come from or what language they speak.”

Intentionally targeting families with predatory mortgage services because of their national origin is a clear violation of the Fair Housing Act,” said Paul Compton, HUD’s General Counsel. “This charge sends a clear message that HUD will protect the housing rights of all persons to the fullest extent of the law.”

This year marks the 50th anniversary of the passage of the Fair Housing Act, and the 30th anniversary of amendments to the Act prohibiting discrimination against persons with disabilities and families with children. This year, HUD, local communities, housing advocates, and fair housing organizations across the country are conducting a variety of activities to enhance awareness of fair housing rights, highlight HUD’s fair housing enforcement efforts, and end housing discrimination in the nation. Read more.

The Fair Housing Act prohibits discrimination in housing because of race, color, religion, national origin, sex, disability and familial status. People who believe they have experienced discrimination may file a complaint by contacting HUD’s Office of Fair Housing and Equal Opportunity at (800) 669-9777 (voice) or (800) 927-9275 (TTY). Housing discrimination complaints may also be filed by going to www.hud.gov/fairhousing.

 

Mark Demetri Stein, 38, Carrollton, Texas, the owner of Real Estate Solutions, and the final defendant in a high-profile north Texas “foreclosure rescue” case has been sentenced for his role in the scheme, which swindled nearly a quarter of a million dollars from at least 70 homeowners facing foreclosure.

According to documents filed in the case, from February 2012 to January 2013, Stein and three co-conspirators used third parties to contact vulnerable homeowners, offering them an opportunity to get out of their present home loans and receive new, cheaper loans with lower interest and reduced monthly payments. http://www.mortgagefraudblog.com/?s=Mark+Demetri+Stein

They lied to desperate homeowners, telling them “investors” were standing by, ready to purchase homeowners’ loans from their original lenders at a greatly reduced price through a “short sale” process, and suggesting homeowners had the legal authority to transfer their deeds to a foreclosure rescue company. Then, although they knew they would not legally own the property, Stein and his co-defendants assured homeowners a foreclosure rescue company could “sell” the property back to the homeowner with a new loan.

There were no investors.  The defendants simply pocketed funds collected from these defrauded homeowners.

They issued fraudulent new “loans” requiring hefty down payments, demanded the homeowners sign fraudulent documents, and directed homeowners to start making all future loan payments to them.

As they continued to collect these so-called “mortgage payments,” they instructed homeowners to ignore notices of late- and non-payment from other lenders. In order to further conceal their criminal conduct, they even advised several homeowners file bankruptcy in order to forestall foreclosure.

Stein who pleaded guilty in April to one count of mail fraud  was sentenced to six years in prison and ordered to pay $215,138 in restitution to homeowner victims.

The three other defendants, Christina Renee Caveny, 37, Richard Bruce Stevens, 53, and Bruce Kevin Hawkins, 54, also pleaded guilty and were sentenced for felony offenses stemming from the scheme. (Caveny was sentenced to 15 months in prison in November 2017. The following month, Hawkins was sentenced to 41 months.  Late last month, Stevens was sentenced to 41 months.)

The announcement was made by U.S. Attorney Erin Nealy Cox of the Northern District of Texas.

The case was brought as part of the Northern District of Texas’ Bankruptcy Fraud Initiative. Since May 2013, the initiative has prompted a significant increase in the number of felony prosecutions of bankruptcy-related crimes in north Texas. A total of 27 defendants each prosecuted due to criminal referrals from the United States Trustee’s Office  have been charged and convicted.

The Federal Bureau of Investigation’s Dallas Division conducted the investigation, and Assistant U.S. Attorney David Jarvis prosecuted the case.

Yant Garcia, 38, Hialeah, Florida pled guilty on September 5, 2018, to one count of conspiracy to commit an offense against the United States.

According to the plea document, beginning around 2012, and continuing through around 2015, Garcia agreed with others to launder the proceeds of an identity theft tax refund scheme and mortgage fraud scheme by cashing checks in names of persons who were not present at check-cashing stores in Miami.

In or around 2013, Garcia’s co-conspirators submitted fraudulent tax returns to the Internal Revenue Service (IRS) using stolen personal identity information seeking refunds ranging in value from $130,000 to $170,000.  In total, the Department of Treasury paid out approximately $4.3 million in fraudulent refund claims by mailing out tax refund checks.  The defendant and a co-conspirator met with the owner of a check-cashing store in Hialeah and the true owner of the store agreed to cash these checks for a thirty percent fee.

In or around 2015, Garcia and his co-conspirators engaged in a mortgage fraud scheme on a property in Miami Beach.  Garcia and his coconspirators submitted fraudulent loan applications and received approximately $3.7 million in proceeds from this mortgage fraud via interstate wire to the account of the fake title company in Miami.  Garcia then provided checks to co-conspirators who cashed these checks at check-cashing stores in South Florida in the names of payees who were not present.  http://www.mortgagefraudblog.com/?s=Yant+Garcia

Garcia is scheduled to be sentenced on November 14, 2018 at 10:30 a.m. before U.S. District Judge Marcia G. Cooke.

Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Robert Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office and Michael J. De Palma, Acting Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI) made the announcement.

Mr. Greenberg commended the investigative efforts of the FBI and IRS-CI.  The case is being prosecuted by Assistant U.S. Attorney Michael N. Berger.

Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

Zalathiel Aguila, 45, Vallejo, California pleaded guilty last Friday to conspiring to commit wire fraud affecting a financial institution and bank fraud.

According to court documents, from September 2004 through February 2008, Aguila and co-conspirators Sergio Roman Barrientos and Omar Anabo operated an entity named Capital Access LLC, Vallejo, California. Capital Access preyed on homeowners nearing foreclosure, convinced them to sign away title in their homes, spent any equity those homeowners had saved, and used straw buyers to defraud federally insured financial institutions out of millions of dollars in home loans obtained under false pretenses. The equity stripped from the properties was then used for operational expenses of the scheme and personal expenses of the conspirators. Vulnerable homeowners across California lost their homes and savings as a result of the scheme, and lenders lost an estimated $10.47 million from the fraud. http://www.mortgagefraudblog.com/?s=+Zalathiel+Aguila

Barrientos and Anabo are scheduled to be sentenced on September 21, 2018, and April 26, 2019, respectively.

Aguila is scheduled to be sentenced by U.S. District Judge Garland E. Burrell Jr. on November 16, 2018. Aguila faces a maximum statutory penalty of 30 years in prison and a $1 million fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

U.S. Attorney McGregor W. Scott made the announcement.

This case is the product of an investigation by the Federal Bureau of Investigation and the United States Postal Inspection Service. Assistant U.S. Attorneys Matthew M. Yelovich and Todd A. Pickles are prosecuting the case.

 

Bobbie W. Williams, a.k.a. Robert W. Williams, 56, Akron, Ohio was indicted for using a fraudulent Social Security number and falsely overstating his income to obtain a mortgage of more than $300,000.

The indictment alleges Williams falsified information on his loan application in order to secure the purchase of the property located on Ridgewood Road, Akron, Ohio. Then, after Williams could not make the payments on the property and it went into foreclosure, he falsified information in his bankruptcy petition, including his true identity and his ownership of the Ridgewood Road property.

An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

Williams is charged with on one count of bank fraud and two counts of bankruptcy fraud.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations.  In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.

The matter is being prosecuted by Assistant U.S. Attorney Mark S. Bennett, and Special Assistant U.S. Attorney Amy Good, Trial Attorney, United States Trustee, after an investigation conducted by the U.S. Department of Housing and Urban Development, Office of Inspector General and the Cleveland office of the Federal Bureau of Investigation.

Brian Roy Lozito, Jacksonville, Florida, has been charged today for deceptively marketing and selling mortgage and foreclosure relief services to consumers throughout the United States, defrauding consumers out of more than $160,000.

Lozito, while doing business as American Investigative Services, LLC allegedly deceived more than 150 consumers by claiming to provide services in return for payments upfront.

According to the complaint, American Investigative Services solicited upfront payments from consumers promising to conduct a forensic audit of consumers’ mortgage documentation in order to uncover evidence of improper robosigning, or improper notarization, assignment, or recording of the mortgage documents, or other technical deficiencies. The defendants told consumers that if these purported legal deficiencies were uncovered in mortgage documents, the lender would be unable to foreclose on the consumer’s mortgage, and the consumer would thereby own the home free and clear, even if the consumer stopped making mortgage payments to the lender. The defendants even claimed that consumers could recover mortgage payments the consumers had previously made to mortgage companies.

The complaint also alleges that the defendants performed none of the promised services, and instead used the money obtained from consumers to pay Lozito’s personal expenses. The complaint alleges violations of Florida’s Deceptive and Unfair Trade Practices Act, and seeks permanent injunctive relief, restitution, civil penalties and fees.

Attorney General Pam Bondi made the announcement.

Consumers who paid fees to the above-named entity or individual can file a complaint by calling 1(866) 9NO-SCAM or file online at MyFloridaLegal.com

To view the complaint, click here.

Eric Granitur, 60, Vero Beach, Florida, an attorney, George Heaton, 75, West Palm Beach, Florida, a property developer and Stephen McKenzie, 46, Melbourne, Florida, a condominium buyer were sentenced today to prison for participating in a criminal conspiracy and making false statements to a federally insured institution.

According to the court record, in 2009, Eric Granitur owned and operated Live Oak Title, which conducted two real estate closings for the purchase of five condominiums at the Vero Beach Hotel and Spa.  The seller and developer of the Vero Beach Hotel and Spa, George Heaton paid numerous incentives to buyer Stephen McKenzie to purchase the condominiums.  Heaton agreed to pay the “cash-to-close” amount that the buyer McKenzie was expected to bring to closing, and nearly $380,000 in additional cash after closing.

Granitur’s title company, Live Oak Title, conducted the closings for the sales of the Vero Beach Hotel and Spa condominium units sold to buyer McKenzie.  As an escrow agent, Granitur was required to truthfully and accurately prepare and distribute a settlement statement to the financial institutions, known as a “HUD-1,” in preliminary form for review by the financial institution, prior to the closing of escrow.   The closing statement was required to accurately reflect, among other information, the sales price, the closing funds provided by the borrower and all of the seller’s contributions.  As an escrow agent, Granitur was responsible for receiving and holding in trust, in an escrow account, the mortgage loan proceeds from the financial institutions that financed the purchase of the condominium units, and he was responsible for disbursing those loan proceeds only after final approval by the financial institutions.

On two occasions, involving Vero Beach Hotel and Club condo units sold by Heaton to McKenzie, Granitur knowingly caused a false closing statement to be transmitted to a federally insured financial institution.  The HUD-1 closing statements failed to truthfully disclose seller credits and incentives.  Additionally, the closing statements failed to disclose that the seller was paying the buyer’s “cash-to-close.”  The financial institutions relied upon the closing statement in authorizing the release of funds.

U.S. District Judge Robin L. Rosenberg sentenced Granitur, Heaton and McKenzie to prison today.

Granitur was sentenced to 12 months and one day in prison, to be followed by 5 years of supervised release.  He was ordered to forfeit approximately $28,000.

Heaton, who pleaded guilty and cooperated with the government, was sentenced to 6 months in prison, 3 years of supervised release, and forfeited approximately $263,000.

McKenzie, who pleaded guilty and cooperated with the government, was sentenced to 4 months in prison and 3 years of supervised release.

Benjamin G. Greenberg, United States Attorney for the Southern District of Florida; Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; and Edwin Bonano, Special Agent in Charge, Tampa, Florida, Federal Housing Finance Agency, Office of Inspector General (FHFA-OIG) made the announcement.

Mr. Greenberg commended the investigative efforts of the FBI and FHFA-OIG in this matter.  This case was prosecuted by Special Assistant U.S. Attorney Joseph A. Capone and Assistant U.S. Attorney Daniel E. Funk.

Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.