Aleksandr Kovalev, 53, Rocklin, California, pleaded guilty to wire fraud involving financial institutions in connection with a mortgage fraud scheme involving the purchase of at least 31 properties.
According to court documents, Kovalev was in the business of developing, building and selling property in Sacramento, Fairfield and Stockton, California. As the real estate market began to weaken, Kovalev offered to make incentive payments to purchasers, through “down payment assistance” or by making other payments to the buyers to be used in whatever manner the buyers wanted. Most of the payments to the buyers were out of escrow and were often paid through intermediaries, originating in Kovalev’s bank account. These payments were not disclosed to the lenders, and had the effect of substantially reducing the actual sales price below that was represented to the lenders. At least 31 properties were involved in Kovalev’s mortgage fraud scheme with substantial losses to the lenders.
To date, five co-defendants have pleaded guilty and have been sentenced: Jannice Riddick, 34, Sacramento, California (two years and 11 months in prison); Florence Francisco, 65, Houston, Texas (one year in prison); Adil Qayyum, 34, Rosele, Illinois (three years of probation); Elsie Pamela Fuller, 41, Richmond, California (one year and nine months in prison); and Leona Yeargin, 49, San Pablo, California (18 months in prison). Charges are pending against co-defendant Arthur Menefee, 45, Stockton, California.
Two other defendants were charged separately for their involvement in the scheme. Valeriy Vasilevitsky, charged in U.S. v. Vasilevitsky, 2:12-cr-344 KJM, and Ruth Willis, charged in U.S. v. Willis, 2:13-cr-228 MCE, have also pleaded guilty and await sentencing.
Kovalev is scheduled to be sentenced by U.S. District Judge Morrison C. England Jr. on February 9, 2017. Kovalev faces a maximum statutory penalty of 30 years in prison and a fine of $1 million or twice the gross loss or gain.
This case was the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation. Assistant U.S. Attorney Todd A. Pickles is prosecuting the case. The guilty plea was announced by Acting U.S. Attorney Phillip A. Talbert.