Thursday, October 27, 2005

Eight charged in $12M Money Laundering Scheme

”This is one of the largest money laundering scheme that I have seen as Nassau’s District Attorney. I would like to thank the New York State Banking Department for their assistance during the course of this investigation. My office will be prosecuting this case vigorously, and as always, will work to obtain full restitution on behalf of the victims.”
- Nassau County District Attorney Denis Dillon

Eight individuals who conspired to bilk lending institutions and homeowners out of $12 million dollars were charged by the Nassau County District Attorney’s office.

Charged three counts of grand larceny, one count of money laundering and one count of conspiracy were:

Joseph W. LaForte, 34, Staten Island, New York and Miami Beach, Florida;

James LaForte, Jr., 28, Staten Island, New York (brother of Joseph W. LaForte)

Tina LaForte, 56, Staten Island, New York (mother of Joseph W. LaForte and James LaForte, Jr.)

James LaForte, 59, Staten Island; New York (father of Joseph W. LaForte and James LaForte, Jr.)

Tara Gibson, 33, Staten Island, New York and McKinney, Texas (sister of Joseph W. LaForte and James LaForte, Jr.)

Jaime Lynn Guli, 27, Staten Island, New York

Francis Alfieri, 27, of 18 Hillis Street, Staten Island, New York

Michael O’Leary, 29, Staten Island, New York was also charged in a separate felony complaint with money laundering and conspiracy)

According to District Attorney Denis Dillon, “The charges are based on allegations that the defendants conspired to steal over $12 million from various lending institutions by forming a corporation, which appeared to be a law firm. They used that corporation to act as attorneys for banks at mortgage closings and then would launder the proceeds through related entities and back to themselves. The corporation they formed, LaMattina & Associates, Inc. opened a bank account to handle the banks’ funds, which was entitled the LaMattina & Associates, Inc., Joseph LaMattina Settlement Trust Account.”

“None of the eight individuals charged are attorneys,” said Dillon. “Instead, James LaForte contacted Joseph LaMattina, a Staten Island attorney and relative and arranged to make him Secretary of the corporation and use his name. No charges have been brought against Mr. LaMattina at this time. The other corporate officers were, Joseph W. LaForte, its first President, followed by Tina LaForte and Tara Caminiti (now Gibson), Vice President.”

“Once the corporation was formed, it made arrangements to represent the banks at mortgage closings,” said Dillon. “They opened an office at 220 Old Country Rd., Mineola, New York where most of the closings took place. The banks would wire the funds into the Joseph LaMattina Settlement Trust Account and LaMattina & Associates, Inc. was then supposed to write checks to either the borrower or on the borrower’s behalf. They then began moving millions back and forth between related entities. Instead they used these fund for their own benefit.”

“The Grand Larceny in the First Degree count charges that the defendants stole over $1.5 Million in the beginning of August from First Continental Mortgage and Investment Corp., by removing the funds wired into the Settlement Trust account rather than disbursing them at the borrower’s direction,” said Dillon. “The Second Count, Grand Larceny in the Second Degree, accuses the defendants of stealing $350,000 from Coastal Capital Corp. located in Greenvale, NY in the same manner on August 1, 2005. The Third Count, Grand Larceny in the Second Degree, charges the defendants of stealing over $720,000 from Credit Suisse First Boston Financial Corp. The funds were wired into the Settlement Trust Account on August 10, 2005, the closing was never held and the defendants removed the money to other accounts and eventually to themselves.”

“The Money Laundering Count alleges that the defendants moved over $4 Million to GMC Land Services, Inc. of Florida and over $9 Million to Key Land Services,” said Dillon. “In August the defendants issued three Certified Checks totaling over $1.7 Million to Hillis, Inc. and used those funds to buy bank checks, which they used to make purchased or cashed,” said Dillon. “The felony complaint also charged that Francis Alfieri laundered $578,000 through his bank account and that James LaForte, Jr., Joseph W. LaForte, Frank Alfieri and Michael O’Leary cashed bank checks totaling $610,000 at Page Avenue Check Cashers, where Michael O’Leary was employed.”

“The stolen funds were used to make mortgage payments on real estate owned by the defendants, to buy a 2005 Bentley and Corvette,” said Dillon. “They also used the funds to make mortgage payments of $100,000 and more on real estate they owned. The complaint also alleges that James LaForte Jr. caused a bank check in the amount of $331,851.55 to be issued to a 22 year old female residing at his address.

“The individual homeowners in theses cases were also victims,” said Dillon. “The initial complainant was a homeowner who had just sold her house. After she moved out and the buyers moved in, the checks bounced. In addition, the check sent to pay off her mortgage also bounced. It left her in the position of owing money on a mortgage on a house she no longer owned. Over thirty homeowners were similarly effected.”

Seven of defendants face up to eight and one-third to twenty five years in prison on each of the Grand Larceny in the First Degree and Money Laundering in the First Degree Charges. Michael O’Leary faces up to eight and one-third to twenty five years in prison on the money laundering charge.

The investigation is continuing and anyone with additional information should contact the Special Investigations Bureau at (516) 571-2100.

mortgage fraud