Tuesday, November 11, 2008

Defendants Sentenced For Straw Buyer Scheme

Donald L. Jones, a/k/a “Don Jones,” 61, Grapevine, Texas was sentenced before U. S. District Judge Sam A. Lindsay to 51 months in federal prison. Jones was also ordered to pay $2,710,834.64 in restitution. Jones pled guilty in July to conspiracy to commit wire fraud. Co-defendant Robert Patterson, Jr., a/k/a Bob Patterson, 55, Dallas, Texas was also sentenced to 46 months in federal prison and ordered to pay $517,954.46 in restitution. Patterson pled guilty in July to conspiracy to commit wire fraud.

As previously reported by Mortgage Fraud Blog, Donald Jones and Robert Patterson, along with six other defendants were named in a 17-count indictment charging each of them with conspiracy to commit wire and bank fraud, and other offenses related to a mortgage fraud scheme involving forty properties and more than seventy loans.

Co-defendant Joseph B. Jackson, Sr., a/k/a “Joseph Jackson,” 63, Irving, Texas, is scheduled for sentencing on November 17, 2008. Jackson pled guilty in August 2008 to conspiracy to commit wire fraud. Donald L. Jones and Joseph Jackson represented themselves as real estate investors who owned and operated Affordable Homebuilders and the YIN Group in Irving, Texas.

Co-defendant Donald Matthew Jones, a/k/a “Mat Jones,” 35, Maui, Hawaii, is also scheduled for sentencing on November 17, 2008. Jones pled guilty in August 2008 to conspiracy to commit wire fraud. He was an employee of Affordable Homebuilders and also owned and operated home healthcare centers under the names of Private Home Health Care and Brain and Spinal Cord Injury LLC.

Co-defendant Daniel J. Sattizahn, 29, Plano, Texas, was sentenced on September 15, 2008 to 24 months in federal prison and order to pay $2,095,136.41 in restitution. Sattizahn pled guilty in January 2008 to conspiracy to commit wire fraud.

Co-defendant Catherine L. Dike, a/k/a “Cathy Dike,” and “Cathy Carter,” 59, Plano, Texas, was an escrow officer. Dike was sentenced in November 2007 to 24 months in prison and ordered to pay $1,995,968.83 in restitution. Dike pled guilty in July 2007 to false acknowledgment of appearance or oath in relation to closing documents.

Co-defendant William Barnes, 59, Desoto, Texas, who owned BCT Landscaping, pled guilty October 23, 2008 to conspiracy to commit wire fraud. Co-defendant Foday S. Fofanah, 38, Waxahachie, Texas, is scheduled for sentencing on December 15, 2008. Fofanah pled guilty in September 2008 to conspiracy to commit wire fraud. Barnes and Fofanah recruited straw borrowers.

The defendants ran a scheme to defraud mortgage lenders and financial institutions. As part of that scheme, they located single family residences in and around the Dallas, Texas area that were offered for sale, recruited straw borrowers to purchase the targeted single-family residences, inflated the sales prices of the targeted residences to an amount greater than the fair market value of the residences; prepared and submitted false and fraudulent loan applications in the name of straw purchasers to secure mortgage loans for the targeted residences in amounts substantially greater than the fair market value, obtained substantially inflated loans from mortgage lenders and financial institutions based on false and fraudulent misrepresentations about repairs that were to be made on the targeted residences, paid the original owners of the residences, and distributed the remaining fraudulently-obtained proceeds among themselves.

The properties used in the scheme were located in Irving, Texas, on Broadmoor Lane and Glenbrook Drive; in Arlington, Texas, on Shadow Ridge, Wimbledon, Racquet Club Drive, and Woodsong Trail; in Sherman, Texas, on Preston Drive and Post Oak Drive; and in Rowlett, Texas, on Beech Street and Orchid Lane.  The loans on the properties have gone into default. The total amount of fraud attributed to these defendants is estimated to be approximately $14 million.

U.S. Attorney Richard B. Roper of the Northern District of Texas praised the investigative efforts of the Federal Bureau of Investigation. U.S. Attorney Roper also thanked the Plano, Waxahachie, Desoto, Grapevine and Irving, Texas Police Departments for their participation in the arrests. The case is being prosecuted by Assistant U.S. Attorney’s Marcus Busch and Kim McCabe. 

mortgage fraud

1. This is a pretty straight forward straw buyer scheme. These schemes usually get discovered when the inflated loans go into default.

   Posted by Dallas Movers  on  06/26  at  07:04 AM