Conspirators Admit Inflating Purchase Prices to Obtain Kickbacks

Allison Tussey —  April 23, 2014 — Leave a comment

Nsane Phanuel Ligate, 42, Ashburn, Virginia, a real estate agent, pleaded guilty to conspiring to commit wire fraud in connection with a mortgage scheme involving the purchase of two properties located on North Patterson Park Avenue, Baltimore, Maryland. Co-defendant Cane Mwihava, 43, Bowie, Maryland, pleaded guilty to the same offense.

According to their pleas (Ligate, Mwihava), in 2008, Ligate and his co-conspirators identified two properties for sale located at 424 and 444 North Patterson Park Avenue, Baltimore. Also at that time, Mwihava established a shell company called Xavier Engineering and Construction Company (XECC) to receive settlement disbursements for purported home renovations.

With assistance from Ligate, co-conspirator Gladyness Silaa acted as the real estate agent; and co-conspirator Larry Johnson acted as the buyer. Ligate, Silaa and Johnson included false statements in the loan applications for both properties regarding Johnson’s employment, income, credit and assets. Mwihava and Ligate falsely inflated the purchase price of the properties by representing to lenders that repairs and renovations had been completed on each property by XECC, including installation of premium kitchen cabinets, granite countertops, stainless steel appliances and marble flooring. None of the purported renovations or repairs were in fact performed.

After the settlement of the properties, the settlement agent disbursed a total of $108,860 to XECC, the amount shown on false invoices submitted for the purported renovations. Mwihava then divided these funds between himself, Ligate, Silaa and Johnson.

On June 5 and 9, 2008, Ligate and Mwihava caused banks to wire transfer $181,159.65, and $179,866.93, respectively, to the title agent to complete the settlement transactions. These amounts were needed to fund the original loan amounts plus additional costs and fees associated with the closings.

As a result of the conspiracy, HUD, which insured the loan for 424 North Patterson Park Avenue suffered a loss of $164,090, and a bank which was the lender for the other property suffered a loss of $188,001.58.

The defendants face a maximum sentence of 30 years in prison and a $1 million fine. Chief U.S. District Judge Deborah K. Chasanow scheduled sentencing for Mwihava on October 14, 2014, at 1:00 p.m. and for Ligate on October 16, 2014 at 10:00 a.m.

Gladyness Silaa, 35, Bowie, Maryland, previously pleaded guilty to conspiracy to commit wire fraud and her sentencing is scheduled for June 16, 2014 at 10:00 a.m. Larry Johnson, 57, previously pleaded guilty to making false statements in a loan application and was sentenced on February 24, 2014 to eight months in prison consecutive to the current sentence he is serving on an unrelated case.

The guilty pleas were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Acting Inspector General Michael P. Stephens of the Federal Housing Finance Agency, Office of Inspector General (FHFA-OIG); Special Agent in Charge Cary A. Rubenstein of the Housing and Urban Development Office of Inspector General (HUD); Special Agent in Charge Brian Murphy of the United States Secret Service – Baltimore Field Office; and Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).

The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available Fraud/index.html.

United States Attorney Rod J. Rosenstein commended the FHFA- OIG, HUD-OIG, Secret Service and HSI Baltimore for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Kristi N. O’Malley and Special Assistant U.S. Attorney Kevin DiGregory from the Federal Housing Finance Agency, Office of Inspector General, who are prosecuting the case.



Allison Tussey

Posts Google+

No Comments

Be the first to start the conversation.

Leave a Reply

Text formatting is available via select HTML.

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>