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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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Second In Command Sentenced In Massive Georgia Fraud Scheme
Leslie Rector, 35, Atlanta, Georgia, was sentenced to federal prison for his participation in a massive mortgage fraud scheme that targeted the Atlanta, Georgia metro housing and condo market from 2000 through part of 2003.
Based upon convictions for conspiracy, loan fraud, mail and wire fraud, and money laundering, Rector was sentenced to 7 years in prison to be followed by 3 years of supervised release, and ordered to pay restitution in the amount of $40.226 million. Rector was convicted on March 14, 2007, following an eight week trial.
As previously reported by Mortgage Fraud Blog, Co-defendants who went to trial with Rector and were also found guilty of multiple felony charges include: Phillip E. Hill, 51, Sumatra, Florida, convicted of conspiracy, loan fraud, mail and wire fraud, and money laundering; Marcus Alcindor, a/k/a Christopher Alcindor, 42, St. Lucia, convicted of conspiracy, loan fraud, mail and wire fraud, and money laundering; Barbara Brown, f/k/a Barbara Eubanks, 34, Marietta, Georgia, convicted of conspiracy, loan fraud, mail and wire fraud, and money laundering; Fred Farmer, 59, Roswell, Georgia, convicted of conspiracy, loan fraud, mail and wire fraud, and money laundering; Christine Laudermill, 40, convicted of conspiracy, loan fraud, wire fraud, and money laundering; Robert Powers, 45, Cumming, Georgia, convicted of conspiracy, loan fraud, mail and wire fraud, and money laundering; David Thomas, 46, Hammond, Louisiana, convicted of conspiracy, loan fraud, and money laundering; Dean Thomas, 42, Atlanta, Georgia, convicted of conspiracy, and money laundering and David Van Mersbergen, 46, Atlanta, Georgia, convicted of conspiracy, loan fraud, and money laundering.
In addition to the defendants found guilty at trial, several other individuals pleaded guilty to mortgage fraud charges related to the same scheme before trial. These defendants include: William Chavis, 45, Atlanta, Georgia; Michael Flake, 31, Stone Mountain, Georgia; Wesley Golden, 57, Atlanta, Georgia; Christopher Halcomb, 45, Cumming, Georgia; Cortney Jackson, 49, Detroit, Michigan; Wayne Jenkins, 49, Atlanta, Georgia; Rashid Muhammad, 36, Syracuse, New York; Julian Perez, a/k/a Tony Perez, 49, Roswell, Georgia; Brant Petree, 23, of Marietta, Georgia; Theodore Tagalakis, 36, Atlanta, Georgia; and Andrew Wolf, 45, Alpharetta, Georgia.
According to United States Attorney Nahmias and the information presented in court: Leslie Rector was Phillip Hill‘s right-hand-man when it came to running Hill‘s many corporations and orchestrating the massive mortgage fraud scheme that targeted the Atlanta area from 2000 through 2003. Rector helped Hill oversee the other participants in the conspiracy, loan fraud, wire and mail fraud and money laundering activity related to mortgages obtained in the sale of over 50 homes and over 250 condominiums in eight Atlanta-area condominium complexes. Each property was sold at an inflated price to a straw purchaser who applied for a mortgage loan based upon the inflated price. Such a fraudulent transaction is called a mortgage flip. The straw purchasers who participated in these mortgage flips were paid a kickback out of the excess loan proceeds for the use of their name and credit. The victim-lenders granted the loans based upon numerous false representations and documents regarding the credit qualifications of the straw purchaser as well as false representations that the straw purchaser had paid a down payment, would reside in the home, and would be responsible for the loan payment. In addition, the lenders were induced to make the loans based on fraudulently inflated appraisals. Some of the properties were flipped more than one time. After Hill ran out of funds at the end of the conspiracy, Rector started to advance money to Hill and others to facilitate more property flips.
“The mortgage fraud scheme in which this defendant participated resulted in multi-million dollar losses to lenders and had an even more devastating impact on individual homeowners and many whole neighborhoods,” said United States Attorney David E. Nahmias. “This sentence, along with the other sentences imposed in this case, as substantial as they are, cannot compensate the many persons hurt by the corrupt actions of these fraudsters. But we hope that this sentence again demonstrates to those who might consider participating in mortgage fraud that such crimes may lead them straight to many years in a federal prison.”
Rebecca A. Sparkman, Special Agent In Charge, Internal Revenue Service Criminal Investigation said of the case, “The financial impact of mortgage fraud has been a very real and frequent threat to the asset most important to the taxpayers of the Atlanta metropolitan area - our homes. Mortgage fraud is a serious offense and today’s sentencing sends a clear message that the punishment will be as serious as the crime.”
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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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