Scott Eric Perry, 34, Brookwood, Alabama, was indicted on wire fraud and false statement charges related to a more than $1 million mortgage fraud scheme in the Birmingham, Alabama area. The 34-count indictment filed in U.S. District Court charges Perry with 17 counts of wire fraud and 17 counts of making false statements to lending institutions in connection to real estate transactions between February and December, 2006.
According to the indictment, Perry‘s scheme was carried out as follows:
Perry, doing business as Master Industries, bought houses in Jefferson County for the purpose of reselling them. From about Feb. 22 through Dec. 21, 2006, he sold numerous properties to various buyers throughout the Birmingham area. In each of these transactions, a federal Department of Housing and Urban Development form, a HUD-1 Settlement Statement, was issued that is required to accurately and truthfully disclose the payment of all monies associated with the transaction, and which parties made the payments.
Perry signed and submitted the statements as true and accurate, but failed to disclose that he both made the down-payments for the purchase of the homes and paid the purchasers at least $3,000 as an incentive to buy the properties.
The indictment charges that the submission of the false documents prompted lending institutions to authorize mortgage loans they would not, otherwise, have approved.
Those loan approvals resulted in the electronic wiring of fraudulently obtained money from the lending institutions, through a Federal Reserve Bank outside of Alabama, to a trust account Perry had at Central Alabama Title in Birmingham, according to the indictment. Amounts of the 17 wire transactions charged as fraud range from $54,400 to $67,200.
The maximum sentence for the wire fraud counts is 20 years in prison and a $250,000 fine. The maximum sentence for the false statements counts is five years in prison and a $100,000 fine.
U.S. Attorney Joyce White Vance announced the indictment.
The indictment seeks forfeiture of $1,062,300, as the amount of the loans fraudulently obtained as a result of Perry’s fraud.
The FBI investigated the case. Assistant U.S. Attorney Patrick Carney is prosecuting it.
“Mortgage fraud damages our banks and lending institutions, but it also hits hard at our neighborhoods and communities,” Vance said. “When a property goes into foreclosure, surrounding homes tend to be harmed by lowered property values. Often the foreclosed properties are abandoned and the vacant houses become a source of vandalism or drug-related activities,” she said. “We are committed to seeking out mortgage fraud and prosecuting the perpetrators.”
Members of the public are reminded that the indictment contains only charges. A defendant is presumed innocent of the charges and it will be the government’s burden to prove a defendant’s guilt beyond a reasonable doubt at trial.