Tuesday, June 05, 2007

Four Plead Guilty in Alabama Mortgage Fraud Scheme

All four defendants indicted in connection with an Alabama mortgage fraud scheme have plead guilty:

Darlene Hill, Mobile, Alabama - Real Estate Investor;

Joycelyn Easter, Mobile, Alabama - Loan Closer;

Kathy Fryee, Eight Mile, Alabama - Notary; and

Antonio Harrison, Mobile, Alabama - Loan Officer.

Darlene Hill, plead guilty to one count of wire fraud and one count of submitting a fraudulent loan application. According to the plea agreement, Hill set up a company called Harris Title, and later, Rankin and Associates, to do fraudulent loan closings and admitted to recruiting others to work for her and close the fraudulent loans. Hill also set up a company called Sylvan Ross Properties to purchase properties using “credit investors”, or individuals with high creditor scores recruited to act as straw borrowers for Hill. The straw borrower in return was paid a fee for their services. Hill admitted to submitting a fraudulent loan application to Regions Bank dba Regions Mortgage. After procuring the fraudulent loan, Hill would assume the mortgage payments and then flip the property, in other words, sell the property, for a profit.

In an effort to generate more funds, Hill would also conduct multiple transactions, where she would sell the property to another straw borrower and fail to pay off the mortgage. The benefits of the multiple transaction were twofold, Hill would receive the fee for the second mortgage transaction, as well as free up the initial straw borrower for future purchases.

Jocyelyn Easter plead guilty to one count of wire fraud and one count of submitting a fraudulent loan application. Easter was recruited to close loans for Sylvan Properties and knew of, or became aware of, the mortgage fraud scheme, yet continued to close loans.

Kathy Frye plead guilty for her participation in the Hill mortgage fraud scheme. Frye was recruited to work at Harris Title and knew, or became aware that Sylvan Properties was a company set up by Hill to purchase properties using “credit investors”. Frye notarized the transaction and did nothing to preclude, prohibit or otherwise stop them from closing in violation of federal law.

Antonion Harrison plead guilty to one count of wire fraud and one count of submitting a fraudulent loan application. Harrison was recruited by Hill to work at Carteret Mortgage as a loan broker and process applications on Hill‘s behalf. After some time. Harrison left Carteret Mortgage and began working for Allfund Mortgage, continuing to process applications for Hill. Harrison, knew, or became aware of, the scheme that was underway. Harrison admitted to submitting a fraudulent loan application to Regions Bank dba Regions Mortgage and was paid outside of closing.

Each of the defendants has agreed to cooperate with the US Attorney’s Office and law enforcement.

mortgage fraud