A fraud ring has been charged in an 82-count indictment for buying and selling the same house four times over four years, stealing one woman’s identity, and securing four mortgages worth $2 million. The defendants include:
Ralph Pecorale, a lawyer (dismissed on Prosecutor’s own motion);
Thomas Debonis, mortgage broker;
Leonard Sudler, mortgage broker;
Richard Sudler, mortgage broker;
Marco Ramos, recruited straw buyer;
Sophia Welsh; and
Yves Mathieu, are all charged with Grand Larceny in the Second Degree, a Class-C Felony; Conspiracy in the Fourth Degree, a Class-E Felony; and other charges. They face up to 15 years in prison, if convicted.
The defendants are charged with conspiring to fraudulently buy and sell 698A DeKalb Ave. Kings County, New York, as many as five times, between 2005 and 2009. They first purchased the building, which was apparently vacant since 1975, in 2005, using a straw buyer, whom they helped to get a loan, using falsified information, according to the indictment. That purchase was for $600,000, and the mortgage was for $544,000. The indictment also charges that in 2006 the ring arranged for the building to be sold to a different straw buyer, for $715,000. With two mortgages equaling the full sale price, the defendants were able to pay off the first the mortgage and profit $102,000, according to the indictment.
The ring eventually stopped making mortgage payments, and in 2007, foreclosure proceedings had begun. The indictment charges that on Feb. 14, 2008, the defendants convinced the banks holding the mortgages to accept $524,000 to settle the debt – approximately $200,000 less than they were owed. On the same day, according to the indictment, the ring sold the property to yet another straw buyer – this one using a stolen identity – who had obtained a $675,000 mortgage, allowing the defendants to reap a profit of $151,000 in a single day.
In 2009, the mortgage was in default, and the defendants were negotiating with the bank for another fraudulent sale, when the scheme was discovered by the Brooklyn District Attorney’s Office and stopped.
The scam came to light when a Brooklyn, New York, resident learned a mortgage company believed she had defaulted on a $675,000 mortgage. Having never applied for, nor accepted, the loan, she contacted the Brooklyn District Attorney’s Action Center, to report that her identity had been stolen. The case was investigated by the Mortgage Fraud Unit of the Rackets Division.
The indictment charges that Pecorale represented the banks in all four transactions. Debonis, Leonard Sudler and Richard Sudler are mortgage brokers charged with putting together the fraudulent deals. Ramos is charged with recruiting a straw buyer and creating a fake employment record for him. Welsh is charged with assisting in the identity theft. Mathieu and two others, who have already pleaded guilty, are charged with creating false employment and financial documents to aid in the identity theft and related mortgage application.
An indictment is an accusatory instrument and not proof of a defendant’s guilt.
Kings County District Attorney Charles J. Hynes announced the charges.
“Mortgage fraud is extremely damaging to its victims and our communities,” said District Attorney Hynes. “Victims’ credit histories get ruined by mortgage fraud, banks lose millions of dollars, and property values can be artificially inflated, even while those buildings stand vacant and neighborhoods are destroyed due to foreclosures. I would like to acknowledge US Senator Charles Schumer, who secured a grant that allowed my office to create the Mortgage Fraud Unit, which investigated and is prosecuting this case.”