Friday, October 09, 2009

Final Guilty Plea in $47 Million Mortgage Fraud Scheme

Viktor Kobzar, 32, Federal Way, Washington, the last of seven people charged in a $47 million mortgage fraud scheme pleaded guilty in U.S. District Court in Seattle to Conspiracy to Commit Bank Fraud, Mail Fraud and Wire Fraud and Filing a False Tax Return. Kobzar faces up to eight years in prison and fines of up to $350,000 when sentenced by U.S. District Judge Marsha J. Pechman on January 8, 2010. Kobzar was a mortgage broker and is one of seven defendants indicted and arrested in March 2009. The defendants were involved with three Bellevue, Washington companies: Emerald City Escrow LLC, Nationwide Home Lending LLC, and Kobay Financial Corporation.

These other defendants have also entered guilty pleas and face up to five years in prison and a $250,000 fine when sentenced on December 4, 2009:

Camie Byron, 28, Renton, loan officer for Kobay and Nationwide.
Alla Sobol, 28, Renton, a mortgage broker for Nationwide.
David Sobol, 40, Issaquah, an owner and operator of Emerald City Escrow.
Sandra Thorpe, 55, Shoreline, an accountant who falsified income statements and employment verification letters.
Donata Baydovskiy, 28, Bellevue, part owner of Emerald City Escrow, also faces five years in prison and a $250,000 fine when sentenced on December 18, 2009. Her husband, Vladislav Baydovskiy, 31, Bellevue, Washington, a mortgage broker, is scheduled to be sentenced January 8, 2010 and faces up to eight years in prison and fines of up to $350,000.

All of the defendants will be required to make restitution in amounts to be determined by the court.

According to records filed in the case, investigators reviewed dozens of loan files that were submitted by Nationwide and Kobay to lending institutions. In 69 of these loan files, representing over eighty percent of the reviewed files, fraudulent information was submitted to obtain some $47 million in loans. All of the loans were closed at Emerald City Escrow. The defendants used "straw buyers" and other unqualified buyers to obtain purchase money and refinance loans. Employees and principals at Kobay and Nationwide prepared and submitted falsified loan applications and related verification documents to lenders in a scheme to conceal the fact that buyers were otherwise unqualified to obtain the loans. Relying on the falsified statements, lenders extended loans that often exceeded the value of the property and the borrower's ability to re-pay the loan. Employees and principals of Emerald City disbursed the excess loan proceeds from the escrow accounts to themselves, or others associated with them.

One property in Medina, Washington was sold to a recruited buyer for $775,000 and within six months was sold again to a second recruited buyer for $1.2 million. The falsified loan application submitted by Kobay on behalf of the second buyer reported a monthly income of $45,000 a month with assets of more than $800,000. In fact the buyer operated a house cleaning business and earned between $18,000 and $20,000 a year. The loan was closed at Emerald City Escrow. Bank records indicate hundreds of thousands of dollars in proceeds from the transaction were paid directly to be used to benefit Viktor Kobzar and Vladislav Baydovskiy. Some of the funds went to pay Vladislav Baydovskiy's homeowner's management fees and moorage fees for his yacht.

A second property in Newcastle, Washington was purchased by David Sobol in August 2007, for $669,950. A month later Sobol sold the property to co-defendant Camie Byron for $1,000,000 - about $330,000 more than his purchase price. Using falsified loan applications that misrepresented her income and assets, Byron obtained two loans on the property totaling about $900,000. Byron then "flipped" the property again to another straw buyer in November 2007. The purchase price in November 2007 was $1.4 million. The loan application submitted by the buyer in November 2007 grossly inflated the buyer's income to meet the lending requirements. According to the application, the buyer earned more than $324,000 in 2005 and $385,000 in 2006. In fact, the buyer reported income to the IRS of $13,245 in 2005 and $16,600 in 2006.

The defendants have agreed to forfeit $2.5 million and a number of luxury vehicles. The vehicles include a 2004 Lamborghini Gallardo, a 2006 BMW 750 and a 2002 BMW X5 and a 31 foot Bayliner.

The case is being investigated by the FBI, U.S. Postal Inspection Service, and the Internal Revenue Service Criminal Investigation (IRS-CI).

The case is being prosecuted by Assistant United States Attorneys Jim Oesterle and Carl Blackstone.

mortgage fraud

1. I am just amazed how people think of this crap. The question is was it worth it? I ahve been in this business for a while but doing the right really matters. secondly I think comission structure from the financial business or advice should be eliminated. That should eliminate the fruad to a great extent.

   Sam
   voyage home loans

   Posted by  on  10/09  at  03:07 PM

2. You think that is bad.  I was swindled by an ex-gf to help her boss buy two houses that he was already renting to HUD families. The girl, Lisa A.Rosen, and her boss, Julio Vargas, of Delta Mortgage (now e1investments.com) of Chicago, as a favor gave me $7K to ruin my life by buying for them over $500K in real estate and I was not even employed. The same contracts I signed weren’t the contracts I was given after the closing.  Along with the title agent, Marie Eiter, they stole as much as they could.  Julio Vargas was not even present at both of the closings. Lisa, Alex Arthur and Janina Vargas were. Later, I began to receive the payments for the properties and was assured that they would take care of it.  I soon realized I was duped and Lisa was nothing more than a true grifter. From foreclosure to no longer having any credit rating at all, the rest of my life is and remains ruined.  That was four yrs ago this happened. I was informed by the FBI to get help from a HUD agent.  Anyways, nothing has happened to those people at all except that they have definitely ripped off dozens and maybe hundreds of other poor people. Often I have thought about killing each one of them but thought the govt would someday arrest or stop them.  I was wrong. There are so many things wrong with the contracts that the HUD agent commented that ‘these are the worst cases of blatant fraud’ he has ever seen. Well, I have been fined several thousand dollars by the city of chicago for providing inadequate heat and water to section eight renters who suffered, Julio collected the money, I didn’t even know ppl lived there..  the list is too long to tell all but it just never ends. I’d kill Julio Vargas for one cent and spit on his fn grave.

   Posted by  on  10/10  at  01:50 AM

3. 1: Jimmy, get some profession help.

   2: Wasn’t anyone home at the lenders these grifters obtained the loans from, or where these big lenders too busy packaging mortgages into CDO’s to give a damn about the fraud involved?? I’d go with the latter assumption.

   Hard to believe they “didn’t notice” houses going up in value by hundreds of thousands of dollars in a few month’s time, and being sold to folks with little to no income.

   How come it used to be so hard to obtain a mortgage in the 80’s and before, yet no one watching in the Bubble period under Bush??

   Start at the top, that’s where the fraud began and was planned...complete with “deregulation” of regulators....

   Posted by  on  10/13  at  10:00 PM

4. Farang,

   What higher power gives you the authority to judge another? The US govt is guilty of being ‘persuaded’ by the banking industry to be given a ‘license’ to exploit and steal from ‘subprime’ or disadvantaged people and turns its back on helping them at any point, then you have a systemic govt which is evil. Steal from the poor and give to the rich? So, Jimmy, has had his life screwed over and over by the ‘process.’ So, who really has more rights?  The victim or the culprit? So, this Julio guy can just run amuck and rip off many more people and families without any single legal or protective measure to stop people like him? The answer is a hands down “YES.” What if, this Julio person ruined many families and people’ lives? Sounds like he has without any intervention or stop gap to prevent him from harming people. So, you are content with this knowledge?  Therefore, all evidence supports that we live in a society governed by a purposeful intent to allocate intentional devices to harm or undermind entire classes of people without providing them any avenue to rectify the wrongs done to them.  So, in your eyes and theirs, Jimmy needs help and you recommend a shrink?  You are as callous and cold as this country has become.  Money is not God but it is for some. So, our Constitution is a fraud also because ‘all people are created equal’ but some are just ‘more equal’ than others.  Undoubtedly, there is much media censorship of one of the biggest scams in American industry. Jimmy has every right to be angry, it seems that it is his only right he has now. I empathize with him and anyone else who may have fell victim to these real estate people. I for one, am ashamed of this country’s business sector married to the government and what it has done to ‘sell out’ the american people and the american dream. What a nightmare this country has become, just because we believed that we had a government that cared about its people and were wrong.  Now, we must get rid of this government and its two party system which caters to big business and its rights directly over yours as a human being. So, Jimmy is the guilty one and Julio is neither guilty or innocent because he can do whatever he wants illegally because he has a license to steal and nobody cares.

   Posted by  on  10/25  at  11:54 PM