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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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Mortgage Broker Convicted of Defrauding Homeowners
Gregory Cooper, 42, New York, has been convincted by a jury in White Plains federal court of defrauding homeowners in Queens and the Bronx, New York through a predatory mortgage scheme. The jury also convicted Cooper of carrying out a separate scheme in which he and his co-conspirators defrauded mortgage brokers around the country by selling them lists of purported "live leads" - homeowners who had supposedly expressed an interest in speaking with a local mortgage broker about refinancing their mortgages - which were, in fact, lists of individuals who had never expressed any such interest. The jury's verdict followed a two-week trial before United States District Judge Kenneth M. Karas in White Plains, New York.
According to the Superseding Indictment and the evidence at trial:
Beginning in approximately 2003, in the Bronx, Cooper and several co-conspirators set up a business that telephoned mortgage brokers around the country, offering them lists of purported "live leads" - homeowners in the brokers' local area who had purportedly expressed an interest in speaking with a local mortgage broker about refinancing their mortgages. Cooper charged the mortgage brokers approximately $20 per name - approximately $3,000 per list - claiming that the leads were collected through a massive telemarketing and survey effort. In fact, the lists were downloaded from an online service for 10 cents per name, and Cooper and his co-conspirators had no reason to believe that any of the individuals on the lists had any interest in refinancing their mortgages. Cooper and his coconspirators collected more than $700,000 selling these bogus "leads."
In 2006, Cooper moved his business to Central Valley, New York, where he and his co-conspirators operated from the basement of Cooper's house. During this period, Cooper and his co-conspirators turned their attention from defrauding mortgage brokers to defrauding New York City homeowners. Specifically, Cooper and his co-conspirators cold-called homeowners in working class neighborhoods in Queens and the Bronx, offering them the opportunity to refinance their mortgages at a fixed interest rate of approximately two percent for the first five years, and approximately five percent for the final 25 years. Cooper prepared and supplied the homeowners with documents appearing to substantiate these rates.
In fact, the exclusive type of mortgage that Cooper sold was a negative amortization mortgage with a fixed interest rate of one percent for the first 30 days, which adjusted every month thereafter, generally to rates between eight and nine percent. Employing various false statements and other deceptions, Cooper and his co-conspirators managed to get their clients to execute these mortgages without the clients ever understanding that the true terms were not remotely those that had been promised. Only upon receiving their initial mortgage statements did the victims recognize that they had been swindled.
From 2006 through 2008, Cooper and his co-conspirators brought in more than $750,000 in brokerage commissions from several dozen fraudulently induced mortgages, collecting between approximately $15,000 and $20,000 per mortgage. The victims, unable to carry the mortgages that Cooper had tricked them into executing, had to pay thousands of dollars each to refinance and, in some instances, had to face foreclosure and the loss of their homes.
The jury convicted Cooper of nine counts of mail fraud and two counts of conspiracy to commit mail fraud. Following the verdict, Judge Karas revoked Cooper's bail and remanded him to jail. Cooper faces a maximum potential sentence of 220 years in prison, as well as a maximum fine of the greater of $250,000 or twice the gross pecuniary gain or loss from the offense on each count.
Cooper, 42, is scheduled to be sentenced by Judge KARAS on February 23, 2010.
Mr. Preet Bharara, the United States Attorney for the Southern District of New York said: "In these tough economic times, we will not allow common criminals to prey upon hard-working people trying to achieve the American dream of home ownership. As we did today, we will continue to bring to justice unscrupulous fraudsters who saddle honest men and women with unaffordable mortgages and fears of foreclosure." Mr. Bharara also praised the investigative work of the United States Postal Inspection Service, Ronald J. Verrochio, the Inspector-in-Charge of the New York Office and the Town of Woodbury, New York Police Department.
Assistant United States Attorneys Kathryn M. Martin and Michael A. Levy are in charge of the prosecution.
I am trying to understand something..... the borrowers went to a closing. There they were presented documents from the bank. The bank attorney explained everything to them. They had three days to review the documents. Unless Cooper falsified the closing documents what is he really guilty of - false advertising?? How different is he than the thousands of mortgage companies that advertise a low fixed rate, but never really close your loan at that rate?
Why isn’t the banks attorney charged?
I can tell you what happenned. Someone complained to the AG about his fake lead buisness and once the AG opened up a can of worms, there was no turning back.
This guy Cooper is def a slimeball, but there are an awful lot of borrowers who didn’t read a thing, a bank attorney who didn’t do his job and most probably a title closer/company that was party to it as well.
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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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