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Patrick Lee, 46, formerly of Canton and Easton, Massachusetts,  a dual United States-Irish citizen was sentenced yesterday on charges arising out of a multi-year mortgage fraud scheme.

Between July 2005 and May 2007, Lee engaged with others in a mortgage fraud scheme. Specifically, Lee or a relative bought five multi-family buildings in Dorchester and South Boston, Massachusetts financed those purchases with fraudulently obtained mortgage loans, and quickly converted the buildings to condominiums which facilitated the resale of individual units in the buildings to straw buyers. The straw buyers were recruited for this purpose and their purchases were financed with fraudulently obtained mortgage loans. The straw buyers were assured that they would not have to put any money down or pay the mortgages, and that they would get a fee at closing and/or a share of the profits when the properties were sold. The loans were funded with interstate wire transfers from the mortgage lenders to the closing attorneys’ conveyancing accounts, and the proceeds were then distributed to Lee and/or a family member, the recruiters, and others involved in the scheme. According to the government, mortgage lenders suffered losses of about $3.9 million. Many of the lenders are no longer in business or no longer hold the fraudulent loans at issue. http://www.mortgagefraudblog.com/?s=Patrick+Lee

Lee was sentenced to four years in prison, three years of supervised release, and ordered to pay restitution of $842,552 to victim lenders. Lee will also be subject to asset forfeiture, in an amount to be determined later.

In November 2018, Lee pleaded guilty to wire fraud and making an unlawful monetary transaction. He was extradited from Ireland in 2017 to face the charges, marking the first extradition from Ireland to the United States since 2012.

United States Attorney Andrew E. Lelling; Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston; Stephen A. Marks, Special Agent in Charge of the U.S. Secret Service, Boston Field Office; and John Gibbons, U.S. Marshal for the District of Massachusetts, made the announcement today. Assistant U.S. Attorneys Sandra S. Bower and Christine Wichers of Lelling’s Criminal Division prosecuted the case.

Patrick Lee, 45, formerly of Canton and Easton, Massachusetts, a dual U.S.-Irish citizen,  pleaded guilty yesterday to charges arising out of a multi-year mortgage fraud scheme.

Between July 2005 and May 2007, Lee engaged with others in a mortgage fraud scheme. Specifically, Lee or a relative bought five multi-family buildings in Dorchester and South Boston, Massachusetts financed those purchases with fraudulently obtained mortgage loans, and quickly converted the buildings to condominiums which facilitated the resale of individual units in the buildings to straw buyers. The straw buyers were recruited for this purpose and their purchases were financed with fraudulently obtained mortgage loans. The straw buyers were assured that they would not have to put any money down or pay the mortgages, and that they would get a fee at closing and/or a share of the profits when the properties were sold. The loans were funded with interstate wire transfers from the mortgage lenders to the closing attorneys’ conveyancing accounts, and the proceeds were then distributed to Lee and/or a family member, the recruiters, and others involved in the scheme. According to the government, mortgage lenders suffered losses of more than $1.5 million.

Lee pleaded guilty to wire fraud and making an unlawful monetary transaction. Chief U.S. District Judge Patti B. Saris scheduled sentencing for Feb. 28, 2019. Lee was extradited from Ireland to the United States last year to face the charges. It was Ireland’s first extradition to the United States since 2012.

The charge of wire fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release, and a fine of $250,000 or twice the gross gain or loss, whichever is greater. The charge of unlawful monetary transactions provides for a sentence of no greater than 10 years in prison, three years of supervised release, and a fine of $250,000 or twice the amount of criminally derived property. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.

United States Attorney Andrew E. Lelling; Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston; and Stephen A. Marks, Special Agent in Charge of the U.S. Secret Service, Boston Field Office, made the announcement today. Assistant U.S. Attorneys Sandra S. Bower and Christine Wichers of Lelling’s Criminal Division are prosecuting the case.

 

Hugo O. Parra, 43, Cypress, Texas; Carmen P. Turner, 55, Missouri City, Texas; LaTasha Riles, 47, Huntsville, Texas; Leslie Nicole Breaux, 40, Sugar Land, Texas; and Jermaine S. Thomas, Houston, Texas 40; Angelina Gailey, 57, Houston, Texas; and Patrick Lee Gailey, 25, Houston, Texas were each charged by a federal grand jury in separate indictments alleging the individuals filed multiple bankruptcy cases to prevent creditors from initiating foreclosure proceedings against their properties. All defendants are expected to appear before a U.S. magistrate judge in the near future.

The individuals are each charged with filing multiple bankruptcy cases to obtain an “automatic stay” from the bankruptcy courts which would prevent their creditors from initiating foreclosure proceedings against property for which they had outstanding loans.

Each defendant filed multiple bankruptcy cases to prevent a foreclosure proceeding by their creditors, according to the indictments. Each time a creditor would issue a “Notice of Foreclosure,” the defendants would allegedly file a bankruptcy case in order to obtain an automatic stay of the foreclosure. The charges allege that they would take no further action to abide by the requirements of the court to file additional documents and submit a payment plan to the court to pay their debts under the protection of the bankruptcy laws. Following a 45-day-period of no action by the defendants, their cases would be dismissed, according to the indictments.

The number of bankruptcy cases the defendants allegedly filed ranged from four within less than two years to 12 over a five-year-period.

The defendants did not make any payments to their creditors under a court approved payment plan, according to the charges. Additionally, each time a defendant filed a bankruptcy case, he/she allegedly failed to list all of the cases they had previously filed. They also signed each filing as being true and correct under penalty of perjury, according to the indictments.

Each person is charged with bankruptcy fraud-scheme to defraud and making false declarations under penalty of perjury. If convicted of either charge, they face up to five years in federal prison and a possible $250,000 maximum fine.

The indictments were announced by U.S. Attorney Kenneth Magidson.The FBI conducted the investigations with the assistance of the U.S. Trustee’s Office. Assistant U.S. Attorney Quincy L. Ollison is prosecuting the cases.

Kirk Lawrence Brannan, 64, Texas has entered a guilty plea to bank fraud for his role in a mortgage fraud scheme.  Brannan admitted to conspiring with others from 2005 to 2009 to execute a scheme to defraud Wells Fargo Bank and other lenders.

Brannan sold 10 beach homes in the Freeport/Surfside, Texas area to “straw buyers” at exorbitant prices. Other co-conspirators recruited straw buyers who created loan applications with misrepresentations that lenders relied upon in deciding to make the mortgage loans. The applications contained misrepresentations of the buyer’s address, employer, income and expenses. The applications also suggested the buyers were much better credit risks than they actually were. Brannan admitted he paid kickbacks to co-conspirators each time one of the beach homes was sold to a straw buyer.

The beach properties were sold at two to three times the appraised values. The mortgage lenders, including Wells Fargo Bank, were induced to lend the inflated amounts for the purchases through flawed or fraudulent appraisals which were based on comparisons Brannan manufactured to further the scheme.

Brannan created settlement statements that suggested he sold three of his properties to his children at exorbitant prices. Appraisers relied upon these “sales” as comparable sales in appraising Brannan’s remaining properties sold to straw buyers. As a result of the fraudulent appraisals, he and his co-conspirators were able to inflate the values for his properties and deceive the lenders into approving home loans at those exorbitant amounts.

All of the straw buyers defaulted on the mortgages, and all 10 of the beach properties ended up in foreclosure.

The fraudulent mortgage loan scheme resulted in a loss of $5,317,350 to Wells Fargo Bank and the other lenders. Brannan paid $2,401,368 to his co-conspirators as part of the scheme.

U.S. District Judge Lee Rosenthal accepted the plea and set sentencing for Aug. 29, 2018, at which time Brannan faces up to 30 years in federal prison and a possible $1 million maximum fine. He was permitted to remain on bond pending that hearing.

Co-conspirators Chucoboie Lanier, 41, Houston, Texas, David Lee Morris, 55, Houston, Texas, and Derwin Jerome Blackshear, 50, Houston, Texas, previously pleaded guilty for their roles in the scheme. They are set for sentencing Sept. 26, 2018.

U.S. Attorney Ryan K. Patrick made the announcement.

The Texas Department of Public Safety and the FBI conducted the investigation. Assistant U.S. Attorneys Robert Johnson and Michael Day are prosecuting the case.

Oscar Cantalicio Ortiz, 54, Kingwood, Texas has received a second federal sentence for failing to appear in court. Today, U.S. District Judge Kenneth Hoyt handed Ortiz another 12 months and one day to be served consecutively to the already-imposed 262 months for his conviction of bank fraud.

Ortiz was originally convicted for a mortgage fraud scheme in which he admitted he conspired to commit bank, mail and wire fraud. He was permitted to remain on bond pending his sentencing in that case, but was ordered to wear a GPS monitoring device secured around his leg as a condition of his release.

On April 21, 2017, he cut off the device and left it on the side of the road in southwest Houston, Texas. His vehicle was later found abandoned in a parking lot in the same area of town.

On April 24, 2017, Ortiz was set to appear before U.S. District Judge Kenneth M. Hoyt for sentencing in the mortgage fraud scheme. He failed show for that hearing.

He was residing in Mexico and turned himself in to the U.S. Embassy in Mexico City, Mexico on August 23, 2017. Ortiz told the FBI at the Embassy that he was a fugitive from the United States and had decided to flee because he wanted more time to work on a project. He was flown back to Houston the following day.

Ortiz pleaded guilty December 4, 2017.

Upon his arrival, agents noted that Ortiz had changed his appearance by growing facial hair and dying it and his hair red. Ortiz admitted he had purchased a second car to replace the one he abandoned and drove across the border into Mexico where he stayed until his arrest.

While a fugitive, Judge Hoyt imposed the nearly 22-year sentence in absentia which will be served consecutively to the term imposed today. http://www.mortgagefraudblog.com/?s=Oscar+Cantalicio+Ortiz

The announcement was made by U.S. Attorney Ryan K. Patrick.

The FBI conducted the investigation of both cases. Assistant U.S. Attorney Melissa Annis is prosecuting the cases.

Mervyn A. Phelan, Sr., 74, Newport Beach, California, was sentenced by U.S. District Judge J. Frederick Motz to five years in prison, followed by three years of supervised release, for a wire fraud conspiracy, wire fraud and obstruction of justice from a $17.4 million investment fraud scheme.

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Brian McCloskey, 42, Baltimore, Maryland, was sentenced by U.S. District Judge J. Frederick Motz to 41 months in prison, followed by three years of supervised release, for conspiring to commit wire fraud arising from a $20 million investment fraud scheme wherein McCloskey and his conspirators made false representations to persuade lenders to fund loans.

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Kevin Sniffen, 53, Phoenix, Maryland, an attorney licensed in Maryland, was sentenced by U.S. District Judge J. Frederick Motz sentenced to three years in prison, followed by three years of supervised release, for conspiring to commit wire fraud arising from an investment fraud scheme. Sean Krondak, 44, Irvine California, was sentenced to six months of home detention as part of three years’ probation for obstructing justice.

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Patrick J. Belzner, a/k/a Patrick McCloskey, 45, Selbyville, Delaware, was sentenced by U.S. District Judge J. Frederick Motz to 15 years in prison followed, by three years of supervised release, on charges of wire fraud conspiracy, wire fraud and tax evasion for his role in a scheme to rip off investors by promising to secure large loans in exchange for substantial sums deposited in an escrow bank account.

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Mervyn A. Phelan, Sr., 74, Newport Beach, California, and Gregory E. Grantham, 56, Oceanside, California, pleaded guilty to conspiracy, wire fraud and obstruction of justice for their roles in a real estate fraud scheme whereby private money lenders and investors were persuaded to deposit funds into escrow accounts, which were later pillaged by the conspirators.

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