Wednesday, October 26, 2005

Seven Sentenced in Cincinnati Mortgage Fraud

”This was a crime against the city of Cincinnati, not just the lending institutions.”
- Debra Bass, Senior Vice-President, Trustcorp Mortgage Company, South Bend, Indiana

A $50M mortgage fraud flipping scheme involving over 1,000 homes in the Cincinnati, Ohio area has resulted in 4 more sentences.  So far, thirty people have plead guilty in connection with the scheme.  Those sentenced were:

Donald M. Powers Jr., 40, former attorney, Forest Park, Ohio (former owner of Premier Land Title, Glendale, Ohio) was sentenced to 38 months in prison followed by five years supervised release, ordered to pay a fine of $150,000, ordered to pay restitution of $34,217 to the IRS and was further sentenced to 800 hours of community service. Restitution will be ordered at a later date.  Powers was charged by information and plead guilty on February 1, 2005 to income-tax evasion and lying on a loan application.  Powers acted as closing agent and sometimes as a real estate buyer in the transactions.

Roger Pepples, 60, retired math and gym teacher, College Hill, Ohio was sentenced to two years in prison followed by five years supervised release, a $50,000 fine and was ordered to devote 700 hours to community service.  Pepples was charged by information and plead guilty on June 1, 2004 to conspiracy, lying on a loan application and income-tax evasion in connection with his role as a seller of scheme properties.

Roberto Ramirez, 36, former real-estate broker, Fort Myers, Florida, was sentenced to 2 years in prison followed by five years supervised release, a $50,000 fines, restitution of $129,927.89 and 600 hours community service. Ramirez was charged by information on May 27, 2004 and plead guilty on September 3, 2004 to conspiracy to defraud the United States and bank fraud.

Steven Carey, 34, former owner of Seven Hills Financial mortgage brokerage and a property seller, Akron, Ohio, was sentenced to 26 months in prison followed by five years probation and was ordered to pay $78,955 in restitution to Trustcorp Mortgage Company of South Bend, Indiana and $6,279 to the IRS. Carey was also ordered to perform 600 hours community service.  Carey was charged by information and pleaded guilty to bank fraud, falsifying a tax return and conspiracy to defraud the government on December 15, 2004.

Horace Roberson, 31, investor and recruiter, New Richmond, Ohio, was sentenced to 22 months in prison followed by five years probation, 600 hours community service, a fine of $50,000 and was ordered to pay restitution of $60,422.26 to Net Bank and $25,185.43 to Indy Mac Bank.  The restitution award might be increased at a hearing currently scheduled for January 20, 2005. Roberson was charged by information and plead guilty to bank fraud and conspiracy to defraud on May 27, 2004.

Charlene Bold, 54, manager at Global Title Agency, Fairfield, Ohio, was sentenced to 14 months in prison followed by five years probation, 600 hours community service and a $10,000 fine.  A hearing for establishment of restitution has been scheduled for January 20, 2005. Bold was charged by information and plead guilty to lying on a loan application on October 15, 2003.

Richard Reynolds, 33, real estate investor, Mount Pleasant, South Carolina was sentenced to 366 days in prison followed by five years probation, 600 hours community service and a $25,000 fine. Reynolds was charged by information and plead guilty to bank fraud and conspiracy to defraud on May 27, 2004.

According to press reports, the community service time must be spent working with community organizations dedicated to improving neighborhoods impacted by real estate flipping.

Assistant U.S. Attorney Amul Thapar said, ”These sentences send a message that those who commit these crimes will be prosecuted and will receive stern punishment.”

mortgage fraud