Friday, December 12, 2008

4 Charged in Mortgage Fraud Scheme

Tiffany Blake Brooks and Dirk Dewayne Minniefield, both of Houston, Texas, Grant William Gondrezick, Benton Harbor, Michigan, and Marc Jason Williams, Fort Campbell, Kentucky have been indicted on charges of conspiracy and wire fraud in connection with their alleged operation of a mortgage fraud scheme in Montgomery and Harris counties, Texas has been unsealed.

The Indictment was unsealed after the arrest of Gondrezick, 45, Williams, 35, and Minniefield, 47, at their residences by FBI agents. Brooks, 33, is expected to surrender to the United States Marshals Service in Houston and will later appear before a U.S. Magistrate Judge. Minnifield, 47, is expected to appear in federal court in Houston later today before United States Magistrate Judge Mary Milloy. Gondrezick, 45, is expected to have his initial appearance in Grand Rapids, Michigan, while Williams, 35, is expected to appear in Paducah, Kentucky.

According to the indictment, the mortgage fraud scheme took place between November 2004 and May 2005. Gondrezick, who operated multiple companies purporting to be in the business of home improvements, is alleged to have recruited and paid straw buyers to purchase properties in which the sales contracts stated the seller would be paying a substantial amount of money for upgrades the buyers desired. Gondrezick is accused of having invoices falsely showing he had installed custom renovations or home theater rooms sent to the title company, resulting in his receiving disbursements at closing. Neither the buyers nor sellers, according to the indictment, ever requested these renovations and the work was never actually performed.

Brooks, who worked as a loan processor at Lone Star Mortgage, is alleged to have prepared the loan applications in the names of the straw buyers and included false information about their income, as well as having recruited straw buyers along with Gondrezick. Williams, who was also a loan processor at Lone Star, is also alleged to have assisted in preparation of the false loan applications and then to have created his own contracting company which began to receive disbursements for renovations that were never done. According to the indictment, Minniefield was a realtor who purportedly represented the buyers in these transactions even though he never met any of the buyers and they never asked to go and look at the properties they were supposedly buying and where they were planning to reside. It is also alleged Minniefield would contact the sellers’ agents and propose the language in the sales contract which would increase the sales price of the properties to include a substantial payment for the supposed renovations. Minniefield is also listed on the incorporation documents for one of Gondrezick’s companies that received the disbursements for work that was never performed.

The indictment alleges the loans that were part of this scheme totaled approximately $10 million and that the disbursements for renovations that were never performed exceeded $1.5 million.

All four defendants are charged with one count of conspiring to commit wire fraud and eight substantive counts of wire fraud. The conspiracy charge carries a punishment of up to five years in prison, while each wire fraud count carries a prison sentence of up to 20 years if convicted. All the counts could result in a fine of up to $250,000. The indictment also contains a notice of forfeiture seeking a money judgment for $10,000,000.

“The impact of mortgage fraud on our country and the economy cannot be denied,” acting United States Attorney Tim Johnson said. “This case and others like it previously filed in our district stands as evidence of our commitment to prosecute those who engaged in mortgage fraud.”

“Combating mortgage fraud is a priority because the lending infrastructure and the housing market have such a significant effect on the nation’s economy,” FBI-Houston Special Agent in Charge Andrew R. Bland III said. “Those who undermine the economic vitality of our community and our nation will be held fully accountable for their actions.”

“This prosecution is a reflection of highly effective investigative and prosecutive coordination between HUD-OIG, FBI and the U.S. Attorney’s Office,” said Herschell Harvell, Special Agent in Charge, Department of Housing and Urban Development-Office of Inspector General, Region 6. “We, as well as our law enforcement partners, will continue to aggressively investigate and bring those who are committing mortgage fraud to justice.”

mortgage fraud