Wednesday, May 16, 2007

Michigan Man Convicted in Mortgage Fraud Trial

Safi Sobh, 34, Dearborn, Michigan, was found guilty today of conspiring to commit bank fraud by submitting false documents in support of mortgage loan applications, and of aiding and abetting bank fraud. Co-defendant Amed Shami, 25, Dearborn, was acquitted of the same charges.

The jury deliberated for about five hours before returning the verdicts, concluding a three-week trial.

The evidence presented during the trial showed between July 2002 and December 2005, Sobh was the leader of a conspiracy that successfully corrupted the system of checks and balances that lending institutions rely upon to determine how much money they can safely lend on a property, and whether a particular borrower is likely to repay the loan. Ohio Savings Bank, Standard Federal Bank, and several other federally insured financial institutions relied upon the false representations of the conspirators and loaned millions of dollars, most of which has not been recovered. Working out of his realty, The Success Group, Sobh hand-picked and taught his co-conspirators how to commit these crimes. The eight co-conspirators who were also indicted and who pleaded guilty included corrupt loan originators, processors, appraisers, and straw buyers. Amed Shami was acquitted of being a straw buyer on two of approximately 30 properties.  The other defendants named in the First Superseding Indictment were Mohamed Hazime, Jad Judeh, Bashar Farraj, Hassan Abdallah and Wael Mortada.  Nadiah Al-Asadi pled guilty prior to the Superseding indictment and was sentenced to one day in prison, followed by 2 years supervised release and was ordered to pay restitution of $199,900.  Also pleading guity were Mahmoud Karkaba, Hani Mortada and Sam Salloum who was sentenced to one day in prison followed by three years supervised release and was ordered to pay restitution of $396,000.00.

Aiding and abetting bank fraud carries a maximum penalty of 30 years in custody and a $1,000,000 fine; conspiracy carries a maximum of 5 years in custody and a $250,000 fine. Sobh’s sentencing has not been scheduled.

United States Attorney Stephen J. Murphy said, “The mortgage lending process depends on the honesty of brokers, appraisers, and real estate agencies. When this process is corrupted by a team of fraudsters, as it was in this case, the result will be a federal prosecution. I salute the hard work of the FBI and the prosecutors who handled this complex fraud trial.”

mortgage fraud