Bank Fraud Gets Husband and Wife Sentenced to Prison

Stephanie Abbott —  March 30, 2018 — Leave a comment

Joseph Atias, 54, Great Neck, New York was sentenced to 40 months’ imprisonment and his wife Sofia Atias, 48, Great Neck, New York was sentenced to 8 months’ imprisonment, following their March 30, 2017 trial convictions for bank fraud and conspiracy to commit bank fraud in connection with the sale of their real property to Sacred Heart Academy, Hempstead, New York for athletic fields. They were also convicted of Medicaid fraud.

The Bank Fraud Scheme

At trial, the government’s evidence established that shortly before the sale of their property adjacent to Sacred Heart Academy for $925,000, the defendants sold the property in a short sale to Bank of America for $480,000 to discharge their mortgage debt.  In negotiating the short sale with the bank, the defendants and their co-conspirator attorney concealed Sacred Heart Academy’s pending offer and submitted a fraudulent contract of sale and other false documents representing that they did not have funds to pay off the mortgages in full.  As part of the fraudulent short sale, the defendants used a relative as a “straw buyer” of the property to create the appearance of an arms-length sale.  Shortly after that sale, the defendant’s straw buyer sold the property to Sacred Heart Academy for approximately half a million dollars in profit.

The Medicaid Fraud Scheme

The government’s evidence at trial established that between 2009 and 2015 the defendants fraudulently obtained Medicaid funds, by concealing their self-employment income and available cash resources, including trust fund monies and the $465,000 in proceeds from the bank fraud scheme.

As part of their sentences, United States District Judge Denis R. Hurley ordered the defendants to pay $465,965 in forfeiture and $49,956 in restitution.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.

Joseph and Sofia Atias committed fraud schemes to try to get out from under mortgage debt and to fraudulently obtain Medicaid funds, essentially flaunting the laws to which we all must adhere,” stated United States Attorney Donoghue.  “This Office and our law enforcement partners will make every effort to ensure that those who would manipulate the system are called to account.

In a clear case of double dipping, the defendants convinced the lending institution of their eligibility to qualify for a short sale on their property, recruited a relative to serve as a straw buyer for the property, and profited from the funds of a subsequent sale of the property,” stated FBI Assistant Director-in-Charge Sweeney.  “At the same time they were running this scheme, they were also found to have engaged in significant fraud against the government. May today’s sentencing remind those who exploit government programs and manipulate gaps in the mortgage and banking sectors that they will face the error of their ways.”

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Charles P. Kelly and Burton T. Ryan, Jr., are in charge of the prosecution.  Assistant United States Attorney Madeline O’Connor of the Office’s Civil Division is handling matters related to forfeiture.

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Stephanie Abbott

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