Thursday, September 04, 2008
Lawyer Pleads Guilty In Metropolitan Money Store Scheme
Richard Allison, 37, Camp Springs, Maryland, an attorney and employee of the U.S. Census Bureau, pleaded guilty to conspiracy to commit mail and wire fraud, in connection with a mortgage fraud scheme which falsely promised to help homeowners facing foreclosure keep their homes and repair their damaged credit.
According to his plea agreement, Allison became employed by the Metropolitan Money Store located in Lanham, Maryland in December 2005. He provided legal services to: the Metropolitan Money Store, which offered foreclosure consultation and credit services to financially distressed homeowners; the Fordham & Fordham Investment Group, Ltd., a foreclosure consulting and credit servicing business based in Lanham and Greenbelt, Maryland; Burroughs & Smythe Financial Services, Inc., another foreclosure consulting and credit servicing business based in Lanham, Maryland; and several individual officers of the companies.
Beginning in March 2006, Allison conspired with company officers in a scheme to fraudulently promise to help homeowners, who had substantial equity in their homes but were facing foreclosure because of their inability to make monthly mortgage payments, avoid foreclosure and repair their damaged credit. The homeowners were directed to allow title to their homes to be put in the names of third party purchasers (the straw buyers) for a year, during which time Metropolitan Money Store promised to improve the homeowners’ credit ratings, help them obtain more favorable mortgages, and eventually return title to their homes to them. The homeowners were told that the equity withdrawn from the properties would be used to pay the mortgage and expenses on their homes and to repair their credit. The straw buyers were paid $10,000 to participate in the scheme.
Using the homeowners’ properties, the conspirators applied for mortgages to extract the maximum available equity from the homes. They prepared and submitted fraudulent loan applications to mortgage lenders to obtain fraudulently inflated loans on the target properties in the straw buyers’ names. At settlements, the conspirators imposed numerous fees and required “seller contributions” which were far in excess of industry standards; they imposed fees for services which were not performed, disclosed or explained to the homeowners; and they transferred the sale proceeds out of the escrow accounts into the conspirators’ business and personal bank accounts and converted a substantial portion of those funds to their personal use.
Allison agreed to act as a straw buyer and secure mortgage loans in his own name for two homeowners whose properties were located in Fredericksburg, Virginia and Washington, D.C., and in return, was paid $10,000 for each property. Allison made false statements as to personal and financial information on a mortgage loan application and settlement documents.
Allison faces a maximum sentence of 30 years in prison and a $1 million fine for the conspiracy. U.S. District Judge Roger W. Titus scheduled sentencing for September 14, 2009 at 1:00 p.m.
United States Attorney Rod J. Rosenstein thanked the Federal Bureau of Investigation, U.S. Secret Service, Internal Revenue Service - Criminal Investigation and the Maryland Department of Labor, Licensing and Regulation’s Division of Financial Regulation Investigative Unit for their investigative work. Mr. Rosenstein commended Assistant United States Attorney James A. Crowell IV, who is prosecuting the case.
mortgage fraud
I guess with more foreclosures coming in the next few years more lawyers and mortgage brokers will be found guilty in connection with a mortgage fraud ...
Posted by on 09/19 at 04:58 AM
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Trial coverage provided by Anne Mitchell, Crazy Fish Realty.
F. Jeffrey Miller Update - October 20, 2009
A hearing was held in Topeka, Kansas in front of Judge Julie Robinson. Miller is currently being held pending his sentencing which is set for December 22nd, 2009 at 9:00 a.m.. Steve Vanatta and Hallie Irvin, Miller's codefendants, will be sentenced at that time also.
Several motions were heard this week. One was a motion for Miller to be released pending his sentencing. Miller's attorney, Jeff Morris, argued that the court had dismmissed with predjudice the matter involving Miller's purchase of a commercial lawnmower, violating the court ordered monitoring agreement. He also argued that Miller was not a flight risk and should be released. This motion was denied.
Another motion heard by Judge Robinson was that of an escrow account containing proceeds from the sale of Miller's forfeited assets. This account has a balance of $143,000. Attorney Morris argued that his firm was due $100,000 for work done in the Miller matter, to date. The government argued that his 'un-itemized fees' were 'exhorbitant'. The balance of the funds, Morris argued, should be released to the Miller family to help pay for mounting household expenses.
The government argued that the 'Asset Forfeiture Provision' applies down to 'the last penny' and that 'the rights of the victims to made whole are of paramount immportance' and that no routine household expenses like Visa bills, are allowed.
Attorney Morris argues that there is more than enough assets to satisfy the jury's judgement of $2.65 million dollars. The government argues that the estimated value of his assets are only $1.4 million.
The government also stated that Miller has been paid dividends from a company Miller has an ownership interest in; Boreflex. From July, 2008 to present, Miller has been paid $330,509.30 from Boreflex, unbeknownst to the court appointed monitor.
Present in the courtroom was Todd Earnshaw. Earnshaw was indicted along with Miller and others in what is commonly referred to as 'Miller I'. That trial is scheduled to begin on January 11, 2010 in Topeka, Kansas.
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Rachel Dollar, the editor of Mortgage Fraud Blog, is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors. She is an author and a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is a shareholder with the law firm of 
