Thursday, November 29, 2007

Atlanta Builder Acquitted of Mortgage Fraud Charges

Randall Tharp, Atlanta, Georgia, a builder for Tyson Homes, Inc., and the Paddocks Development Group, Inc., was acquitted on all charges via directed verdict at the close of the government’s case.  Tharp was indicted in April 2006, and faced charges of conspiracy to commit mortgage fraud, money laundering, bank fraud and wire fraud stemming from the sale of several luxory homes in metro Atlanta, Georgia area.

As previously reported by Mortgage Fraud Blog, The US Attorney for the Northern District of Georgia unsealed a superseding grand jury indictment charging 21 individuals in a complicated mortgage fraud scheme alleged to have operated between June 2004 and April 18, 2006.  The indictment includes 99 counts including bank fraud, wire fraud, mail fraud, conspiracy, money laundering and identity document fraud. 

Those indicted and relevant allegations concerning their roles as reflected in the first superseding indictment were:

Olympia D. Ammons, St. Louis, Missouri, loan officer with Ace Mortgage Funding.  Ammons originated a number of mortgage loans for unqualified borrowers and was paid funds by Wings in addition to her commissions;

Mohamed ‘Mo’ Bayorh, an unqualified borrower who was paid $547,000 through his company, Fairington Winslow, Inc., to obtain in excess of $1.3 Million in mortgages in his own name and to recruit other straw borrowers;

Andre B. Benson, alleged to have been paid $260,000 to cause his mother to obtain over $1.3 million in mortgage loans;

Raymond Joseph Costanzo, Jr., attorney, Atlanta, Georgia, closed a number of fraudulent loans while concealing material facts from the lenders According to the indictment Costanzo was also paid $250,000 to obtain in excess of $1.5 million in mortgage loans for which he did not qualify;

Clarence Lorenzo Davis aka C. Dave Davis is accused of falsely verifying employment for his girlfriend, Virginia Rose Novrit, through his company C. Dave Davis LLC and her income, residence and source of down payments in order to assist attempts to obtain over $6.6 million in mortgage loans.

Mohammad Amin Hassamadi, builder, was the CEO, CFO and Secretary of Polo Tech Construction, Inc. the seller of properties in the St. Marlo Subdivision

Joseph Sterling Jetton is alleged to have arranged for the recruitment of straw borrowers to obtain in excess of $19 million in loans for which they were not qualified.  Jetton induced participation in the scheme by professing religious values.  Though neither Jetton nor his company, Precision Construction Co., was licensed as real estate broker or agent, they appeared as the listing broker on a number of purchase and sale agreements. 

David S. Kroll of DKS Consulting, Inc. allegedly assisted Virginia Rose Novrit to obtain in excess of $1.7 million in mortgages by depositing money into her account to facilitate generation of a verification of deposit, fronted her down payment money and received payment in his company name for those services from the loan proceeds.

Leon Kelly Lumsden of LL & Associates Investment Firm used his company name to provide false employment and income for unqualified borrowers, including himself.  He was paid through LL & Associates Investment Firm and G&L Holdings, Inc. to assist Wings in recruiting straw borrowers.

Ronald Denzil Martin, Jr. was allegedly a paid $145,000 to act as straw borrower for in excess of $1.3 million in mortgage loans.

Ricardo Antonio Myrie was allegedly paid $600,000 to act as straw borrower for in excess of $3 million in mortgage loans.

Hassan Nimapoo, builder, was the CEO, CFO and Secretary of Crown Custom Homes, Inc. and the owner of Lum Crowe Development, LLC, the sellers of number of homes in the St. Marlo and Litchfield Estates Subdivisions.

Virginia Rose Novrit was a straw borrower who attempted to obtain over $6.6 million in mortgages for which she was not qualified

Lawrence Seval Reid aka Lawrence Steven Reid, allegedly an illegal alien using an alias and the stolen SSN of a minor child, was a straw borrower who was paid over $256,000 to obtain mortgage loans in excess of $1.9 million, according to the indictment.

Ariel Hope Samuel aka Arial Carty, an illegal alien and girlfriend of Reid, provided false verifications for Reid as well as the shell company, Raggstone, Inc. for receipt of Reid loan proceeds.  She is further alleged to have used false employment and a stolen SSN to obtain a vehicle and mortgage loan in her Carty alias.

Attemerell Smith is alleged to have acted as a straw borrower for over $1.3 million in mortgage loans.

Daryl Maurice Smith was the owner of McSmith Properties and was a partner in G&L Holdings with Gregory Wings and Leon Lumsden.  Daryl Smith was allegedly paid $332,5000 to cause his mother, Attemerell Smith , to obtain mortgage loans exceeding $1.3 million for a property where Daryl Smith wished to reside. He also allegedly received payments for recruitment of other straw borrowers.

Randall Tharp, builder, vice-president of Paddocks Development, Inc. the seller of a property in the Cobblestone Farms Subdivision.  Tharp also allegedly acted for his wife as the seller of other properties in the Paddocks Subdivision and elsewhere. 

Fabian O. Witlshire allegedly arranged for Kroll to assist Novrit in obtaining in excess of $1.7 million in mortgage loans.

Gregory Jerome Wings, Jr. aka G Money used companies, including G&L Holdings Group, Inc. and Metropolitan Realty, to receive over $2.8 in payments for recruiting straw borrowers.  He was also paid to obtain mortgages in his own name for which he was not qualified and, in addition, he and/or Metropolitan Realty were listed as seller broker although not licensed to act as such, according to the indictment.

Calvin Lee Wright is alleged to have been paid over $527,000 to act as a straw borrower for in excess of $3.5 million in mortgage loans.

The case was initially instituted on April 22, 2005 with a magistrate complaint against Novrit.  On July 5, 2005, twenty-count indictment was filed charging only Novrit and Davis.  The superseding indictment naming the additional nineteen defendants was filed under seal by the US Attorney on April 19, 2006.

According to the indictment, the defendants would recruit straw borrowers, including illegal aliens, to purchase residential properties from builders and others, often at fraudulently inflated prices. They would then obtain artificially inflated appraisals to support the purchase prices, often hundreds of thousands of dollars over the list prices.  The defendants would then obtain fraudulently inflated mortgage loans in the names of the unqualified straw borrowers with the excess loan proceeds to be disbursed to the straw borrowers, their recruiters, those fronting borrower down payments, the builders and other sellers.  The loan applications contained misrepresentations regarding borrower employment, income, assets, liabilities and/or intent to occupy. Down payment information was also misrepresented as down payments were either made by way of cashier’s checks drawn from loan proceeds disbursed at closing or by way of loan from a coconspirator. Shell companies were also utilized to funnel loan proceeds to recruiters, straw borrowers, those fronting down payments and other coconspirators.

According to the indictment, some of the straw borrowers were informed that the properties would be rented to ‘actresses and ball players.’ They were also told that the mortgages, insurance and taxes would be paid for them and that they would make additional money when the properties were sold.

The properties mentioned in the indictment include:

861 Beutell Street, Atlanta, Georgia

10710 Stroup Road, Roswell, Georgia

1341 Epworth Street, Atlanta, Georgia

5886 Seam Street,

2830 Luther Drive,

4560 Old Lake Drive,

13 Sams Point Lane, Hilton Head SC

8425 Coghill Trace, Duluth GA

4338 Azalea Walk, Ellenwood GA

8760 Islesworth Ct, Duluth GA

1106 Pristine Pl, Duluth GA

8415 Coghill Trace, Duluth GA

347 Temple St, Atlanta GA

3192 Vivian Sykes St, East Point GA

8415 Merion Dr, Duluth GA

385 Lum Crowe Rd, Roswell GA

372 Lum Crowe Rd, Roswell GA

376 Lum Crowe Rd, Roswell GA

8915 Doral Dr, Duluth GA

8925 Coghill Trace, Duluth GA

8730 Sawgrass Way, Duluth GA

395 Lum Crowe Rd, Roswell GA

700 Old Saddle Lane, Alpharetta GA

3075 Francis Rd, Alpharetta GA

8905 Colonial Dr, Duluth GA

110 Ryan Lake Trail, Alpharetta GA

384 Lum Crowe Rd, Roswell GA

mortgage fraud

1. Please note that co-defendants Virginia Novrit, Clarence Daivs and Jospeh Jetton were found guilty in this case.  Fabian Wiltshire, Olympia Ammons, Andre Benson, Raymond Costanzo Esq., Ricardo Myrie, Daryl Smith, Calvin Wright, Leon Lumsden and Gregory “G-Money” Wings have all pled guilty.

   Posted by  on  12/05  at  04:13 AM

2. Mohammad Amin Hassamadi and Hassan Nimapoo, both builders, also were acquitted. Joseph Sterling Jetton was found guilty of recruiting straw borrowers although I’m not so sure that’s exactly how it happened. I do believe, however, he got in with the wrong crowd and followed the instructions of a corrupt attorney. As an admonition to any of you out there who “dance in the shadows” I encourage you to make yourself familiar with this case and the law.

   Posted by  on  12/06  at  06:04 AM

3. Do you think we need legislation to first stop and the prevent mortgage fraud? Or is this mess just a case of the usual scumbags on steroids?

   Posted by Lin Ennis  on  12/24  at  06:53 AM

4. Please provide official confirmations that both Mohammad Amin Hassamadi and Hassan Nimapoo have been aquitted.

   Posted by  on  12/29  at  10:19 AM

5. As a response to the comments of Lin Ennis concerning the case in Atlanta and the convictions and pleas, the comment of “scumbags on steroids” is a typically ignorant, knee jerk comment which has no informative value whatsoever. First, legislation is not the cure-all for every problem. Too many people use legislation as an excuse to avoid thought, responsibility, and judgement. Secondly, I personally know a couple of people in this case, and while I have a casual knowledge of one individual, I have had very significant personal dealings with another, and I can tell you that in his case, this is absolutley a case of what Ken Cook’s posting calls “dancing in the shadows”. A more common thread here is the outrageous expectations of profit that these investors have on a single transaction. It is a sad commentary on our work ethic when someone expects to make 50 - 100K on a single flip transaction. Especially when there was nothing created (except by the builder), and no additional value supplied. These people (the flippers and investor buyers) are the ones who raise the prices of homes by artifically inflating the cost to the next round of buyers. I am not against making money, quite the contrary, I own a business (NOT in the real estate, construction, or financial services sector) and I expect to make money on every transaction. But, the difference it that I actually produce a product for this profit, not just repackage and move paper. This is nothing more than an example of someone putting prudence and judgment aside to chase excessive profits. But there were absolutley criminals in this case, namely the buyers and the closing attorney. But I would hope Mr. (Mrs?) Ennis would remember that there are real people involved here, not all of whom are criminals.

   Posted by  on  01/11  at  04:43 PM

6. Bank fraud is already against the law on the federal level, and residential mortgage fraud is already against the law under Georgia laws....and that didn’t stop them.  These guys were convicted under federal law which is cumbersome because prosecutors are frequently required to prove wire fraud, mail fraud, etc. in order to get the conviction.  A targeted law would make it somewhat easier.  But no law or regulation will stop the criminally corrupt or ethically challenged.  The only way to stop it is for each and every person in the transaction to “just say no” to fraud.

   Posted by  on  02/01  at  09:39 AM

7. Ann is absolutely right and it is our responsibility as mortgage insiders to train and equip people at the street level including investors, agents, loan officers, attorneys, appraisers, and more as I have done for many years, to detect, avert and defeat fraud BEFORE it happens. There are thousands of unwitting pawns in many games of fraud played out across the nation to this day. It’s why people like Ralph Roberts, Anne Fulmer and I donate hundreds of hours every year to FREELY educating the public. The last time I checked neither Ralph, Ann nor I have ever been compensated one penny for the hundreds and hundreds of articles we author for online presentation. In this case I didn’t know anyone involved prior to the acts but I have been contacted by them afterwards and they admit had they known me before they would NEVER have participated in the scheme. Read Ralph and Ann’s book PLEASE. (I say, “Education is more powerful than legislation.")

   Posted by  on  02/01  at  10:04 AM

8. Yes, Ann is totally correct, as with most things, it really comes down to people knowing when to say no.

   Posted by  on  02/01  at  10:09 AM

9. I was tangentially involved in this case.  I have a developer friend who had a $3 million assemblage on the market.  He was approached by Raymond Costanzo and G Money, who offered him $9 million for the property on condition that my friend “kick back” $6 million.  They told him that this was their usual and customary way of financing the construction.  Ha!  My friend actually tried to get the deal done, but once he required that they sign some pretty explicit waivers, they went away.

   Posted by  on  02/02  at  05:05 AM

10. #5--Sorry, Craig. I didn’t mean to be calling any specific lawbreaker a scumbag. My remark was flip. I really wanted to hear what others thought about legislation--which seems to deter mostly honest folks anyway.

    Your comments about needing to add value in order to realize a profit remind us all we’re in business first to serve, then to earn--to serve to deserve.

    How bad is the fallout really going to be? How soon can we all recover from the considerable missteps of others?

    Posted by  on  02/02  at  08:27 AM

11. In response to the comment about Joseph Jetton getting in with a crooked attorney and not actually doing what he was convicted of....

    Trust me, there is no doubt that Jetton was the ringleader of this whole operation.  He’s the one that brought the builders, appraiser, attorney, G Money, straw borrowers and mortgage brokers together.  Once he is back in prison it will be the 2nd time he’s been in jail for mortgage fraud!

    If you’ve been following this case it’s interesting to see the builders get off, but for some reason Jetton is facing over 30 years!  Of the people who didn’t plead guilty the only people that have been aquitted were the builders. 

    I am interested to see what the other sentences look like in this case, as I’m sure none of them will be anything like what Mr. Jetton has received.

    Posted by  on  03/05  at  08:53 PM

12. Chicken Little,

    why should I “trust you” concerning Jetton’s involvement. I was pretty close to the whole thing (without involvement...not in the mortgage biz), so I have some actual knowledge of this whole mess. As I said before, no doubt there was wrongdoing in this case, but Jetton was in no way the “ringleader”. What I DO know is that there were former friends of the Jetton’s who were trying to play the greed game along with G Money and the rest of the fradulent buyers, but they didn’t have the capital to play, so they went away angry at being denied their “chance”, and summairly forgot ALL of the many personal things the Jettons did to help them through some very difficult times. I suspect you are a part of that family, and since you are not willing to use a real name.......well, the “chicken” part of the screen name is very justified. If you are not part of this traitor family, then my apologies to you. But then, how do you “know” Jetton is the mastermind. BTW, he is looking at 16-24 months, not 30 years. Please get your facts straight.

    Craig (REAL name)

    Posted by  on  06/06  at  12:12 PM

13. Chicken Little—These are con artists.  “Con” stands for “confidence”.  Con artists always appear trustworthy and persuasive, and prey on those who least expect it.  I am sorry to say that there are many perps who cloak themselves in religion on order to fleece the faithful flock.  Here in Atlanta, there have been many fake “bishops” and several real pastors (Ron Sailor comes to mind immediately) who used the trust that comes from being a fellow church member to commit crimes.  All in all, it’s very sad when the wolves move among the sheep unrecognized.

    Posted by  on  08/24  at  03:07 AM

14. To clear the record… Hassan Nimapoo has now had his second “mistrial.” Government agent caught lying.  Joe Jetton was sentenced to 15 years, but hoping for appeal.  Joe was no “ring leader.” Gregory Wings was the ring leader.  He and his gang of liars who are now in jail.

    Posted by  on  12/10  at  04:41 PM

15. Joe Jetton was in no way the ring leader. At his sentencing, he was sentenced 14 years and mostly over a technicality. Joe is a stand up guy, he was trustworthy. Anyone who thinks that he used religion as a cover up is hghly mistaken. I was close with Joe all throughout this trial and my life, and he is an incredible man, in and out of work. He will get an appeal and he will be out of that prison in less than a year.

    Posted by  on  01/15  at  05:08 AM

16. Sorry, but “someone” is wrong about Joe Jetton.  We bought a house from him in 2003 and he was nothing but a liar.  He lied to the inspector of Roswell while I was standing there.  Then, at our closing he lied and said he was a broker when I already knew he had lost his license for mortgage fraud previously.  My regret is that I did not file a complaint with the state at that time.  He was working for Remax at the time and I did make a complaint with them.  Joe also tried to make you think he was a christian by responding to how are you with “Oh, I’m blessed and better than I ought to be.” Joe Jetton is a crook and he is now where he should be!!!!

    Posted by  on  06/06  at  07:26 PM