Friday, November 16, 2007

New York Business Owner Indicted for Appraisal Fraud

D & T National Appraisals, Inc., and its CEO, Donato Odato, 54, 166-11 Cryders Lane, Whitestone, New York, have been variously charged with second- and third-degree forgery, criminal possession of a forged instrument, first- and second-degree falsifying business records, first- and third-degree identity theft, first-degree scheme to defraud and fifth-degree conspiracy. Odato faces up to seven years in prison if convicted. The corporate defendant faces a fine of up to $10,000 for each felony count conviction or double the amount of the illegal gain.

District Attorney Brown said that, according to the indictment, Odato, as the chief executive officer of D & T National Appraisals, Inc., recruited licensed appraisers over the Internet and offered them positions with his company as part of a ruse to steal their personal identity information. Thereafter, it is alleged he would forge the names of the prospective job seekers on numerous appraisals that he filed in connection with residential mortgage applications for the purchase of Queens County, New York, properties.

It is further alleged that Odato took advantage of the Internet’s anonymity, as well as his own background as a former licensed assistant appraiser, to fraudulently induce lenders and other real estate professionals to use his company’s claimed appraisal services. It is alleged that instead of actually doing the appraisal work, Odato would simply concoct information on real estate values from various sources and then inflate the values to match mortgage applications.

The alleged scheme came to light when financial institutions began reaching out to the appraisers who allegedly had their identities stolen and advised them that their services would no longer be needed due to their inappropriate and highly inflated valuations of properties based on falsified data. The appraisers, in turn, contacted the Queens District Attorney’s Office to report the identity theft.

The defendants were arraigned before Acting Queens Supreme Court Justice James P. Griffin who released Odato on $100,000 bail and set a return date of January 14, 2008.

District Attorney Brown said, “The arrests are the result of a nine-month investigation which alleges a pattern of fraud committed by the defendants in the sale of numerous homes in Queens County and elsewhere in the United States and resulted in artificially high appraisals of the properties. This type of mortgage fraud has the potential to needlessly cost lenders and purchasers millions of dollars, as well as undermine the credibility of the entire real estate market. I want to acknowledge the hard work of all the investigative agencies involved. Without their team efforts, we would not have been able to have uncovered and pursued these allegations.”

Secretary of State Cortes-Vasquez said, “We at the Department of State are pleased to have been able to assist the Queens District Attorney in bringing about today’s indictment. As we all recognize, abuses in the real estate industry have caused serious problems afflicting many New Yorkers. As an integral partner of Governor Spitzer’s HALT (Halt Abusive Lending Transactions) Task Force, the Department of State has been working closely with the Department of Banking to uncover illicit transactions involving real estate brokers, mortgage brokers and home inspectors as well as appraisers. Anyone who intentionally defrauds homeowners and potential buyers deserves to be prosecuted to the full extent of the law. Today’s indictment is a reminder that they will be.”

mortgage fraud

1. I am currently unemployed from one of the top ten mortgage bankers, because I REFUSED TO do fraud for my employer.  I have working in mortgage banking for over 20 years.  I have seen it all, and know for a FACT that the blame is that of the mortgage lenders, closing their eyes and encouraging fraud. No one tells you where to go it fraud is required of gainful employment, who are we supposed to report it to?  No one seems to care or police this industry. It is NOT the fault of the prospective homeowner, they are trusting and believe the lies I heard come out of the mouths of loan officers.

   Posted by  on  11/24  at  01:48 PM

2. To report known fraud you can start by contacting the Office of the Attorney General for your state and the District Attorney for your county. I’m sure they’ll be happy to hear what you have to say. It would be helpful to have proof to backup any accusations, although, obtaining proof is often not possible before leaving your place of employment. Those who are honest and ethical are often forced to leave their employment in order to avoid being involved in fraudulent schemes.  It’s sad to think the reputations of so many people involved in real estate, banking and title insurance industries have been irreparably tarnished by those willing to participate in fraudulent schemes. Dishonest participants have already made their millions and NOW the government has finally taken notice?  Where are the investigators who are supposed to monitor such illegal behavior?  Is anyone out there paying attention?

   Posted by  on  11/26  at  10:38 AM