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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 Smith Dollar, PC, is licensed to practice law in California and maintains offices in Santa Rosa, California. Email Ms. Dollar
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Michael J. Armitage, 55, Pittsfield, Massachusetts and Fort Myers, Florida, was charged in an Indictment with three counts of false statements to a federally insured financial institution, three counts of bank fraud and one count of engaging in a monetary transaction in property derived from specified unlawful activity.
The Indictment alleges that between February 2001 through April 24, 2006, Armitage executed a series of schemes to defraud United Bank, located in West Springfield, Massachusetts. It is alleged that the purpose of the schemes was to obtain three different loans: in 2001, a $975,000 commercial loan for one of his businesses, Venture Properties, LLC; in 2002, a $170,000 commercial loan for Venture Properties; and in 2003, a $400,000 personal residential mortgage for Armitage and his wife, Melissa J. Armitage, to refinance their home at 1 Eastbrook Lane, Pittsfield, Massachusetts.
According to the Indictment, Armitage accomplished these schemes by executing or submitting to United Bank various false or fraudulent documents that misrepresented his finances and concealing the fact that he had embezzled more than $1 million from another of his businesses, Power Development Company, LLC (”PDC”). It is alleged that he owed substantial amounts of money to PDC as a result of this embezzlement, failed to file personal federal income tax returns from 1993 through 2006, and owed substantial amounts of money to the IRS for tax years 1995, 1996 and 1998.
According to the Indictment, these false or fraudulent documents included the following: a 2001 personal financial statement that omitted any debts owed to PDC or the IRS, and that claimed his taxes were settled through 1999; two guaranties in 2001 and 2002 warranting that his financial statements and other financial information true and correct in all material respects; a 2001 personal federal income tax return that Armitage and his wife, Melissa J. Armitage, signed and dated but never filed with the IRS; and a 2003 residential loan application that omitted any liabilities owed to PDC or the IRS.
Lastly, the Indictment alleges that on or about July 29, 2003, Armitage caused approximately $394,000 of his fraud proceeds to be transferred to another bank to pay off his initial mortgage, thereby engaging in a monetary transaction in property derived from specified unlawful activity.
If convicted on these charges, Armitage faces up to thirty years imprisonment, to be followed by three years of supervised release and a $1,000,000 fine.
AUBURN— An Auburn couple have sued several people — including one who tried to flee the country with $1.3 million and has pleaded guilty to wire fraud in an unrelated case — of swindling them out of the title to their home.
Auburn Fire Lt. Francis X. Hartnett, 35, and Kim M. Carville, 34, have been together for 12 years. They have two boys, ages 15 and 11, and have lived at 19 Inwood Road for eight years. Last month, Mr. Hartnett and Ms. Carville say, they found out they lost title to their house two years ago.
Mr. Hartnett and Ms. Carville contend the title was stolen by Stuart Brown, Trisha Graham and Allen J. Seymour, who was arrested Feb. 8 in Florida trying to flee the country on a private jet with $1.3 million hidden in his luggage.
On July 22, Mr. Seymour pleaded guilty to wire fraud and interstate transportation of property stolen or taken by fraud. He recently was named by Assistant Attorney General Andrew Doherty as the mastermind behind an alleged mortgage fraud scheme in an investigation involving as many as 60 properties in Worcester County.
Mr. Hartnett and Ms. Carville said they had fallen behind in their mortgage payments to Ameriquest Mortgage Co. because of illness. The $156,000 mortgage, which they had gotten in December 2003, was scheduled for a foreclosure sale in early November 2005.
A few days before the scheduled sale, their lawyer, Margaret M. Melican, said, Mr. Seymour came knocking on their door and offered to help.
“Their home was scheduled to be foreclosed just a couple of days later, which would have meant that they would have forever lost their home, have to move out and be displaced,” Ms. Melican explained. “So Allen Seymour promised them that he could find a way to stop that foreclosure and leave them in their home.”
“He came at the 11th hour,” Mr. Hartnett added. “We were in desperate times and, at the time, he looked like a savior.”
He said that in the next few days, Mr. Seymour returned to the couple’s home twice — first with lawyer Robert F. Creasia and later with Ms. Graham, who was introduced to them as an “investor.”
During the first return visit, Mr. Hartnett and Ms. Carville insist they signed only one paper, which they say they were told was the second page of an authorization to check the couple’s credit.
“The front page was to give them permission to check our credit, which I thought I was signing. When I signed it, there was nothing else written on the second (page) except two lines to sign on, one for me and one for him (Mr. Hartnett),” Ms. Carville said. “They took the top page off and put a different top page on and added the notary public stuff underneath it.”
A search of the records at the Worcester Registry of Deeds shows that a deed, dated Nov. 15, 2005, conveyed the property from Mr. Hartnett and Ms. Carville to Mr. Brown. The deed, which was recorded Dec. 20, 2005, is notarized by Judith Ann Lebeau.
Ms. Melican said the top page was switched and the notary public added sometime between Nov. 3 and Dec. 20, 2005.
During the next visit, the couple said, they learned they would have to pay almost $400 a week to keep up the expenses of the property, which would come out to be about the same as their monthly mortgage payments.
On Dec. 19, 2005, Mr. Brown signed two mortgages to World Savings Bank, and a $156,000 mortgage to Ameriquest was subsequently discharged. One of the new mortgages was for a negative amortization loan that eventually could have a principal balance of $276,562.50, which was 125 percent of the amount borrowed. The other mortgage was for $44,250. The mortgages were recorded Dec. 20, 2005, immediately after the recording of the deed to Mr. Brown.
Ms. Melican said Mr. Hartnett and Ms. Carville started making payments to Ms. Graham and thought the money was going toward their mortgage.
“We were so afraid to lose our home that we were ready to agree to almost anything,” Ms. Carville recalled. “In any event, we believed that Tricia Graham and Allen Seymour were trying to help us. We thought we were paying our own mortgage, the default for which had been cured somehow by Allen Seymour. Although Allen Seymour referred to the payments as ‘rent,’ we still thought we were paying our own mortgage.”
On July 24, Superior Court Judge Peter W. Agnes Jr. granted restraining orders against Wachovia Bank, the present holder of the delinquent mortgage, from foreclosing, and against Ms. Graham and Mr. Brown from collecting rent, coming to the property and evicting the couple and their two boys from the premises.
Posted by on 08/17 at 04:04 AM
He got me too. Same exact story. I gave up and moved. I hope he rots in jail. How can a human being pray on trusting people. I lived in West Boylston MA at the time.
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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