Monday, July 14, 2008

5 Plead Guilty To Las Vegas Mortgage Fraud Scheme

Eve Mazzarella, 31, a Las Vegas real estate broker and her husband, Steven Grimm, 45, were charged in a superseding indictment with conspiracy to commit bank fraud, mail fraud, wire fraud and money laundering, 13 counts of bank fraud and criminal forfeiture in connection with defrauding federally-insured financial institutions of millions of dollars through a scheme that involved inflated housing values, straw purchasers and limited liability companies.  Mazarrella is also charged with money laundering.

Four additional defendants, Melissa R. Beecroft, 28, Christina R. Thompson, 46, Amy R. Ortiz, 33, and Jyothi Panikkar, aka Joe Panikkar, 52, all loan officers and mortgage brokers in Las Vegas, are now included in the Superseding Indictment and are charged with conspiracy to commit bank fraud, mail fraud, wire fraud, and money laundering, various counts of bank fraud, and criminal forfeiture. Amy Ortiz is also charged with assisting with the provision of fraudulent and false forms to the IRS. Defendants Beecroft, Thompson, Ortiz, and Panikkar, were arrested in Las Vegas on Wednesday, June 18, 2008, and are scheduled to make their initial appearance in federal court before U.S. Magistrate Judge Peggy A. Leen. Defendants Grimm and Mazarrella were arraigned on the new charges June 27, 2008, at 8:30 a.m.

Since the superceding indictment, 5 defendants have plead guilty:

Daicy Vargas, 23, Las Vegas, Nevada, pleaded guilty to misprision of a felony, or concealing or failing to report a felony. She admitted that she helped Grimm divert proceeds of the fraud and failed to report the fraud as soon as possible.

Benjamin Labee, 27, a mortgage loan processor and his wife, Shauna Labee, a mortgage agent, both of Salt Lake City, Utah, plead guilty to conspiracy. The Labees admitted that they conspired with Grimm to recruit straw buyers to pose as property purchasers. The Labees said they misrepresented information in loan applications to induce lenders to fund loans for othwerwise unqualified borrowers.

Craig Christians, 39, a Las Vegas real estate broker, pleaded guilty in June, 2008 to misprision of a felony, admitting that he allowed his company Western Pacific Funding to be used to facilitate the fraud scheme.

Robert Samora, 41, a Las Vegas mortgage agent, pleaded guilty to money laundering.

According to the Superseding Indictment, defendants Eve Mazzarella and Steven Grimm control and operate numerous limited-liability companies that are registered in Nevada and conduct business in Las Vegas. Defendant Melissa Beecroft was resident agent and manager of Secured Mortgage Services, LLC; defendant Christina Thompson was resident agent and manager of CRT Consulting, LLC; defendant Jyothi Panikkar was managing member of Integrity Mortgage, LLC; and defendant Amy Ortiz was registered agent, president, secretary and treasurer of Reliant Mortgage Corporation, all companies registered with the Nevada Secretary of State.

The Superseding Indictment alleges that the object of the conspiracy was to obtain money and property by causing false information to be placed in the mortgage loan applications of straw buyers. It is alleged that the straw buyers were paid to participate in the conspiracy. After the mortgage loans were funded, defendants Grimm and Mazzarella allegedly caused title and escrow companies to disperse a portion of each loan to one of their limited liability companies, and caused mortgage brokers, loan officers and others to remit a portion of their commissions and fees to Grimm and Mazzarella. Once Grimm and Mazarrella obtained control over a property, they re-sold the same property to another straw buyer at an inflated price. Grimm and Mazzarella are also charged with concealing receipt of the monies they obtained through this scheme by causing disbursements to be made to shell companies under their control and by moving money between multiple accounts.

Grimm and Mazarrella allegedly engaged in approximately 432 straw buyer transactions involving approximately 227 properties with a total purchase price of over $107 million. Grimm and Mazzarella defaulted on mortgage payments on many of the loans which caused the properties to go into foreclosure. At least 143 of the approximately 227 properties purchased by the defendants are in default causing losses to the banks estimated at more than $17 million.

The maximum penalties for conspiracy to commit bank fraud, mail fraud and wire fraud and for each bank fraud charge are 30 years in prison and a $1,000,000 fine. The maximum penalties for conspiracy to commit money laundering and money laundering are 10 years in prison and a $250,000 fine. The maximum penalty for aiding and assisting with fraud and false statements is three years in prison and a $250,000 fine.

“The investigation and prosecution of mortgage fraud in Nevada is a top priority of the U.S. Attorney’s Office,” said U.S. Attorney Brower. “The inclusion of new charges and additional defendants to this case demonstrates the magnitude of the mortgage fraud problem. We intend to work closely with our partners on the Southern Nevada Mortgage Fraud Task Force to pursue and prosecute additional individuals who commit this type of offense.”

This is an ongoing investigation led by the FBI and IRS Criminal Investigation, with the assistance of the members of the Southern Nevada Mortgage Fraud Task Force, including the Las Vegas Metropolitan Police Department, the Nevada Attorney General’s Office, Office of the Inspector General for the Social Security Administration, Office of the Inspector General for the Department of Housing and Urban Development, the U.S. Postal Inspection Service, and the United States Secret Service. The case is being prosecuted by Assistant United States Attorney Brian Pugh.

Persons who have information concerning potential mortgage fraud may contact the Southern Nevada Mortgage Fraud Hotline at (702) 584-5555.

The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

mortgage fraud