Friday, October 17, 2008

4 Florida Men Charged With Various Fraud Schemes

Peter Affatati, 39, Coral Springs, Florida, Anthony Affatati, 36, Parkland, Florida, Anthony Louis Cuomo, 30, Coral Springs, Florida and Brian Schlitz, 39, Boca Raton, Florida have been charged in separate Criminal Informations for their participation in various fraudulent mortgage fraud and investment schemes.  The defendants made their initial appearances in federal court in West Palm Beach and Fort Lauderdale earlier today. 

More specifically, the four separate Informations charge the defendants as follows.  Defendant Peter Affatati is charged with:  (1) conspiracy to commit false statements on loan applications, wire fraud, mail fraud, and bank fraud in relation to the mortgage fraud scheme, in violation of 18 U.S.C. §371; (2) conspiracy to commit mail and wire fraud in relation to the fraudulent securities scheme, in violation of 18 U.S.C. §371; and (3) misprision of a felony, in violation of 18 U.S.C. §4.  Defendant Anthony Affatati is charged with: (1) conspiracy to commit mail and wire fraud, in violation of 18 U.S.C. §1349; and (2) conspiracy to commit mail and wire fraud, in violation of 18 U.S.C. §1349.  Defendant Anthony Louis Cuomo is charged with:  (1) conspiracy to commit mail and wire fraud, in violation of 18 U.S.C. §1349; and (2) conspiracy to commit mail and wire fraud, in violation of 18 U.S.C. §1349.  Defendant Brian Schlitz is charged with:  (1) conspiracy to commit mail and wire fraud, in violation of 18 U.S.C. §1349; and (2) conspiracy to commit mail and wire fraud, in violation of 18 U.S.C. §1349.

Peter Affatati is charged in a 3-count Information.  Count 1 charges defendant Peter Affatati with orchestrating a $40 million mortgage fraud scheme involving more than 50 residential mortgages, mostly in South Florida.  According to the Information, Peter Affatati used nominee purchasers, commonly called straw buyers, to buy residential properties.  Peter Affatati would use his company, Assurance Title, to create false supporting documents for the straw buyers, including employment records, income forms and asset statements, in order to qualify them for mortgages from institutional lenders.  Once a mortgage was obtained, Peter Affatati would use a large portion of the funds for his personal benefit.  Count 2 charges Peter Affatati with conspiracy to commit investment fraud by selling to a North Carolina victim approximately $390,000 in fictitious securities.  Lastly, Count 3 charges Peter Affatati with misprison of a felony by helping to conceal the wire fraud in Count 2. 

By separate Information, defendant Anthony Affatati is charged with one count of conspiracy to commit foreign exchange fraud and mortgage fraud, and one count of conspiracy to commit investment fraud.  Count 1 alleges that Anthony Affatati operated various foreign exchange companies, and through brokers, called “introducing brokers,” solicited and handled orders for the purchase and sale of foreign currency option contracts.  The introducing brokers for foreign currency option contracts operated under the names Standard FX, Superior FX, Superior 4X, and Hamilton Edwards, and were located in Coral Springs and Plantation FL. Employees of these companies allegedly called prospective clients and falsely promised them high returns on their investments if they invested in options to purchase Euros.  In these sales pitches, the sales teams minimized or entirely failed to disclose large up-front commissions, the companies’ poor performance history, and made other material misrepresentations and factual omissions. As a result of these misrepresentations, clients suffered approximately $2.5 million in investment losses.  Count 1 also alleges that Anthony Affatati was involved in mortgage fraud, and purchased his Parkland, Florida home through a straw buyer.  Count 2 of the Information charges Anthony Affatati with conspiracy to sell fraudulent securities to the public.  In this second conspiracy, Anthony Affatati, together with co-defendants Cuomo and Schlitz, allegedly sold securities of Hema Diagnostics Systems, a privately held company in Miami-Dade County, FL, without knowledge or permission from the company by making their own promotional literature for Hema Diagnostics Systems.  Defendants Anthony Affatati, Cuomo, and Schlitz kept the investors’ monies for their own use and investors did not receive any stock in Hema Diagnostics. 

Defendant Anthony Louis Cuomo was separately charged in a 2-count Information with one count of conspiracy to commit foreign exchange fraud and mortgage fraud, and one count of conspiracy to commit investment fraud.  Cuomo is alleged to have participated in the $2.5 million foreign exchange fraud scheme operated by co-defendant Anthony Affatati.

Defendant Brian Schlitz was charged in a one-count Information with running a mortgage fraud scheme similar to Peter Affatati’s mortgage fraud scheme, but on a smaller scale.  Through this scheme, Schlitz used straw buyers with falsified employment records, income forms, and asset statements in order to qualify them for mortgages, and then kept a significant amount of the mortgage funds for his own use and benefit. 

Mr. Acosta commended the investigative efforts of the United States Secret Service, the Federal Bureau of Investigation, the Internal Revenue Service, the Coral Springs Police Department and the Broward Sheriff’s Office for investigating this case. The case is being handled by Assistant United States Attorneys Steve Petri, Harry Wallace and Jeffrey Kaplan.

mortgage fraud