Tuesday, October 07, 2008
2 Indicted In Florida Straw Buyer Scheme
Alberto Hernandez and John Fraga were charged in a 21-count Indictment for their participation in a mortgage fraud scheme that resulted in the approval and disbursement of six mortgage loans, totaling approximately $980,000. According to the Indictment, from August 2003 to April 2004, defendant Hernandez, through his company, Ash Homes, sold six properties in Miami-Dade County, Florida to unqualified buyers. The purchases were all financed through Federal Housing Authority (FHA) loans, which are meant to provide low and middle income purchasers with an opportunity to purchase homes at better rates than would otherwise be available. These buyers are able to obtain better rates because FHA agrees to guarantee repayment of the loans.
In all six residential property sales, Hernandez, through straw donors, fraudulently financed the down payments and closing costs of the buyers. Defendant Fraga was one of the false donors, as well as a silent investor with defendant Hernandez. Both defendants received sizable payments once the properties were sold to the unqualified buyers. In each of the six residential property sales, defendant Hernandez signed an Addendum to the HUD-1 settlement statement falsely certifying that he, as seller, was not financing the buyer’s closing contributions. Once the loans were closed, four of the six properties went into foreclosure. As the guarantor of the loans, HUD was required to take title to the property and reimburse the banks for their losses. The approximate aggregate losses to HUD related to these properties is in excess of $550,000.
If convicted, the defendants face 20 years’ imprisonment on the wire and mail fraud charges, 5 years’ imprisonment on the false statement charges, and 2 years’ imprisonment for making false statements to HUD.
mortgage fraud
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During the real estate boom two years ago, some units were going for a half million dollars. Now some are short selling for just 50 grand.
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Most banks rejected Ms. DeForte because her debt level was too high and her credit score too low. But Lend America put Ms. DeForte into a $402,000 loan backed by the Federal Housing Administration...
Mortgage Fraud Probe Nets 105 Across State
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At least one local man is among 105 people arrested across the state following a nine-month investigation into organized mortgage fraud.
Mortgage Fraud Increases
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The number of frauds involving professional advisors, such as accountants and lawyers, has increased from two to four since March 2008.
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Trial coverage provided by Anne Mitchell, Crazy Fish Realty.
F. Jeffrey Miller Update - October 20, 2009
A hearing was held in Topeka, Kansas in front of Judge Julie Robinson. Miller is currently being held pending his sentencing which is set for December 22nd, 2009 at 9:00 a.m.. Steve Vanatta and Hallie Irvin, Miller's codefendants, will be sentenced at that time also.
Several motions were heard this week. One was a motion for Miller to be released pending his sentencing. Miller's attorney, Jeff Morris, argued that the court had dismmissed with predjudice the matter involving Miller's purchase of a commercial lawnmower, violating the court ordered monitoring agreement. He also argued that Miller was not a flight risk and should be released. This motion was denied.
Another motion heard by Judge Robinson was that of an escrow account containing proceeds from the sale of Miller's forfeited assets. This account has a balance of $143,000. Attorney Morris argued that his firm was due $100,000 for work done in the Miller matter, to date. The government argued that his 'un-itemized fees' were 'exhorbitant'. The balance of the funds, Morris argued, should be released to the Miller family to help pay for mounting household expenses.
The government argued that the 'Asset Forfeiture Provision' applies down to 'the last penny' and that 'the rights of the victims to made whole are of paramount immportance' and that no routine household expenses like Visa bills, are allowed.
Attorney Morris argues that there is more than enough assets to satisfy the jury's judgement of $2.65 million dollars. The government argues that the estimated value of his assets are only $1.4 million.
The government also stated that Miller has been paid dividends from a company Miller has an ownership interest in; Boreflex. From July, 2008 to present, Miller has been paid $330,509.30 from Boreflex, unbeknownst to the court appointed monitor.
Present in the courtroom was Todd Earnshaw. Earnshaw was indicted along with Miller and others in what is commonly referred to as 'Miller I'. That trial is scheduled to begin on January 11, 2010 in Topeka, Kansas.
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Rachel Dollar, the editor of Mortgage Fraud Blog, is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors. She is an author and a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is a shareholder with the law firm of 
