Mortgage Fraud Blog is the premier website for news and information on mortgage fraud and real estate fraud throughout the United States.
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 Smith Dollar, PC, is licensed to practice law in California and maintains offices in Santa Rosa, California. Email Ms. Dollar
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Loan Originator Pleads Guilty To Mortgage Fraud Scheme
Marlene Dinnall, a/k/a Marlene Henry, Marlene Angela Hall, and Marlene Morris, 48, Miramar, Florida, pled guilty to a 15-count Indictment charging her with conspiracy, mail and wire fraud, bank fraud, and numerous counts of identification document fraud. Sentencing is scheduled for May 2, 2008.
According to the court documents, Dinnall was a mortgage loan originator with an office in Miami, Florida, who engaged in a scheme to enrich herself by obtaining mortgages from lenders using straw purchasers and through the submission of fraudulent documentation, including false loan applications, false employment verification forms, false salary statements, false IRS W-2s, and false bank account statements reflecting high account balances. Dinnall also used and caused others to use stolen social security numbers as their personal identification at closings, and participated in the sale of fraudulent identification documents and social security numbers and cards. She also provided false financial documents to an individual, who intended to use the documents to obtain an $800,000 line of credit from a federally insured financial institution.
That’s an amazing story. With all the small acts of fraud that happened on a daily basis during the real estate boom, it’s amazing that loan originators would even feel the need to resort to this level of fraud. I knew of one insurance agent who did these kinds of acts, but only on a small scale, and even then there were nothing but bad repercussions from this type of business practice.
Posted by on 01/23 at 03:30 PM
I saw a add in my local newspaper for a 1st deed of trust with a 12% return loan amount, $32,000. My mother and I do “hard money” loans.The real estate broker was licenced, etc...He said this was alittle “different” than the loans I was used to. He saved a guy in foreclosure, etc… He created a “trust” with his own personal attorney as one of the trustees.My mom got $320a mo@12%, the term of the loan 3yrs. When the payments stopped,(approx) 1 year later, he made all kinds of promises to her saying she would NOT loose any money,etc...Next she got a notice he was in default, then filed bankrupcy.When I looked at her documents, It was a 3rd deed of trust, not a 1st!!!!We went to a attorney, he could not figure out the documents either. Said it could be elder abuse, and go to social services, tell them and it would fall under a crimanal act.How do we know what is going on? Haven’t heard from the broker , my mom is out 32,000.Help!
Posted by on 01/27 at 02:36 PM
Jeniffer Wertz contacted me. I’d written a column that mentioned her suit. In the process of getting back to her, I stumbled on your site. I’ll send you the article free if you send me your email address.
You can read it on my website. It’s
#22, as I recall. On appraisals.
Best,
Curtis Seltzer
Posted by on 02/22 at 10:50 AM
I knew this lady, she did my taxes long time ago. I actullay worked with here at this brokers office in coral springs and she always was doing something that the owner didn’t like. She even asked me one time for my password to pull creditand i told her hell no. I see what she was doing!
Posted by on 02/28 at 08:29 AM
If only the loan originators who were deliberately perpetrating fraud were being swept up in the Justice Department’s crusade that would be fine. If indeed this woman recruited people to pretend to be borrowers, then she deserves to be punished.
But the crusade isn’t always fastidious about prosecuting only those who were purposely breaking the law.
Some mortgage brokers have been imprisoned for doing little more than following instructions from “victim” lenders’ loan officers. One broker, for example, was convicted of fraud for omitting source of down payment on no-asset loan apps....just as he was instructed to do by the lender’s loan officer. The officer told the broker only credit scores and debt ratios mattered and other superfluous data might unnecessarily raise red flags in the lender’s computer system.
In the same year the broker was convicted, it was reported that the victim lender in his case, ABN Amro, paid a token fine after admitting its employees “forged” underwriters’ signatures on thousands of loan docs in at least four states. Neither the lender nor its forgers was criminally prosecuted. And the lender was absolved in the settlement of any similar activities that might have occurred in the other 46 states.
In the investigation of the broker’s alleged fraud, it was documents showed ABN Amro had routinely upgraded his no-asset loan apps to higher yielding loans, apparently to make them more marketable in the securitization process.
In another case, a broker was convicted for “inflated appraisals” in transactions when he’d never had any contact with appraisers in the suspect deals. Also, the broker had been closely advised by a property attorney in every loan he submitted, a circumstance that once signaled lack of criminal intent. Yet the feds merely threatened to ratchet up the number of “counts” he’d be charged with if he didn’t sign a plea agreement.
It appears federal agents sometimes work backward from the notion there’s a bad guy behind every foreclosure. But sometimes the bad guys end up being ordinary business people who at worst were working gray areas or, as in the case mentioned above, following unreliable advice from their attorneys.
Lots of potential villains in the mortgage lending crisis have emerged in recent months...Alan Greenspan and the fed, Bush Administration “ownership society” policies, new-home builders internally inflating the sale price of homes, lenders shirking underwriting procedures and packaging risky loans to sell to Wall Street, realtors nudging buyers to buy more home than they could realistically afford etc. etc. Yet the government hammer has only come down on loan originators. Why is that?
Be leary of incendiary boilerplate language in fraud indictments. Much of it boils down to i’s that weren’t dotted and t’s not crossed. Much of what’s occurred in the mortgage fraud crusade is giving the American concept of fairness and justice a big, ugly black eye.
Failed Mortgage Firm Trustee Allowed $50,000 in Fees Union Leader
U.S. Bankruptcy Court Judge J. Michael Deasy will approve $50,000 in legal fees for the trustee of failed mortgage brokerage businesses Financial Resources Mortgage Inc. and CL&M Inc.
Bend Oregon Event to Help Homeowners Prevent Foreclosures Oregon.Gov
As part of an ongoing effort to help homeowners avoid foreclosure, state agencies are organizing a foreclosure-prevention event in Bend on Saturday, March 27, 2010.
Shelbyville Man Gets 2-Year Sentence For Loan Fraud Chattanoogan.Com
Prosecutor Gary Humble said the lost was approximately $2.3 million in the mortgage fraud involving hundreds of homes in the Shelbyville area.
Lend America, VP Ashley Banned from FHA Housing Wire
Michael Ashley, the embattled former vice president of Federal Housing Administration (FHA)-backed mortgage originator Lend America, and the company he worked for, were permanently banned from doing business in the industry last week.
Countrywide Tries to Pin Blame on Insurer Court House News
Countrywide Home Loans demands $111 million from Triad Guaranty Insurance, claiming Triad is trying to blame mortgage lenders for the insurer's role in the housing bubble and collapse.
Investors Say They Were Swindled in Property Scheme Fox 13 Now
Utah Division of Consumer Protection is joining forces with a few investors who claim they have been cheated by an agency called "Utah Mini Ranches.
Greenfield Man Accused of Housing Scam The Republic
A former real estate agent conned at least eight people by renting them properties actually owned by a federal agency and then running off with their deposits, prosecutors said.
Appraisal Institute Opposes Obama Administration's Plan for Homeowner 'Short Sales' PR News Wire
Citing concerns about increased mortgage fraud, four organizations representing more than 35,000 real estate appraisers today voiced their opposition to changes to an Obama administration program that will encourage "short sales" of homes.
Ownership Rights to Get Another Look TBO.Com
State lawmakers may beef up protections of property owners' rights by rewriting a law this spring that is at the center of a case of alleged fraud in Pasco County.
Thursday, February 18, 2010 F. Jeffrey Miller Trial Continued Testimony
As reported by Anne Mitchell, who viewed the trial:
Angela Parenza worked for Jeff Miller as the office manager for 7 or 8 years beginning in 1998. Parenza was indicted along with Miller and pled guilty to conspiracy to commit bank fraud and money laundering. Parenza testified that Miller or his contractors allegedly preferred to build all the...
Wednesday, February 10, 2010 F. Jeffrey Miller Trial Coverage Continued - Witness Testimony
Steve Middleton Testimony - Coverage Provided by Anne Mitchell
The Government continued in its cross examination of Steve Middleton. He was shown several HUD-1 statements involving sales of homes located in Overland Park, KS, and Olathe, KS. The HUD statements each allegedly showed line items of payments to (James) Moser & Associates, LLC's...
Monday, February 01, 2010 F. Jeffrey Miller Trial Coverage - Continued Witness Examination
According to Anne Mitchell, who is present in court for the trial:
Next Witness: Kelly Sanford
Kelly Sanford of the Federal Reserve was a short witness for the Government. Sanford manages electronic payments between banks and member financial institutions. He was shown copies of wire transfers and asked whether they coincided with the counts in...
Wednesday, January 27, 2010 F. Jeffrey Miller Trial - Prosecution Witnesses Continued
According to Anne Mitchell, who is viewing the trial:
January 13, 2010
Witness: Rick Hayes
Rick Hayes testified that on the day that he closed on his Miller Enterprise home, he received a phone call from the Kansas Banking Commission informing him that his loan was fraudulent. After the Hayes responded to a classified ad, they met with John...
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The information and notices contained on Mortgage Fraud Blog are intended to summarize recent developments in mortgage fraud cases and mortgage banking matters nationwide. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about mortgage banking, mortgage fraud matters or who believe they require legal counsel should seek the advice of an attorney. The creators, editors and sponsors of Mortgage Fraud Blog do not intend to create a confidential relationship or an attorney-client relationship by communication via or arising from this site.
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 
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