Mortgage Fraud Blog is the premier website for news and information on mortgage fraud and real estate fraud throughout the United States.
imageRachel 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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Friday, April 28, 2006

W.N.Y. Landlord Pleads Guilty To Felonies in Mortgage Fraud Scam

Robert Palano, 51, formerly of Clarence, New York today pled guilty to Grand Larceny and Scheme to Defraud. He faces two to seven years imprisonment. He was charged in connection with allegations that he fraudulently obtained more than $4 million dollars in mortgage loans on 104 rental properties he owned on the East Side of Buffalo, New York.

In related civil actions, Palano agreed to pay $1.5 million in restitution and penalties and to be permanently barred from owning investment properties in Buffalo, New York. Michael Heigel, Palano’s real estate appraiser, also agreed to pay $55,000 in restitution.

“This case demonstrates how mortgage fraud harms not only financial institutions, but can severely undermine communities and harm homeowners’ and tenants’ lives,” Attorney General Eliot Spitzer said.

A 15-month civil investigation by Spitzer’s office revealed that, between 1998 and 2002, Palano fraudulently obtained more than $4 million dollars in mortgage loans on 104 rental properties he owned on the East Side of Buffalo. After pocketing the loan proceeds, Palano absconded to Florida, leaving at least ten lenders with defaulted loans secured by properties worth far less than the debt, and tenants being evicted through foreclosures.

The investigation revealed that Palano used Heigel to do all of his appraisals which were grossly inflated over the true market value.

The charges in the criminal case arise out of a series of 29 fraudulent loan applications submitted by Palano between March and November 2002 to GMAC Mortgage Corporation. According to legal documents, Palano lied on the applications when he declared that he was not at that time a party to any civil litigation. In fact, Palano was then the defendant in an unrelated mortgage fraud case brought by The Associates First Capital Mortgage Corporation.

By December 2003, Palano had defaulted on all 104 loans and as a result, lenders were left holding collateral that was inadequate to pay off the balance. The consequent foreclosures resulted in the eviction of dozens of families from the rental properties and caused further blight of the neighborhoods as boarded up houses were left vacant for months.

Many of the defaulted loans covered by the civil settlement had been resold by the lenders to Fannie Mae, a federally-chartered institution that buys mortgage loans for the purpose of increasing the availability and affordability of housing for low- and moderate-income Americans. The terms of the civil settlement require Palano to pay $1.4 million to Fannie Mae to reimburse its losses.

This is the second time Spitzer’s office has cited Palano in a mortgage fraud case. A 2001 investigation by the Attorney General’s office found that Palano orchestrated a real estate scheme that targeted African-American, first time home buyers. In resolving that case, Palano agreed to pay $225,000 in restitution to his victims and The Associates agreed to reduce the mortgages of 130 properties by a total of $1.6 million. The Associates later civil action against Palano in this matter was the litigation he failed to report.

This case was handled by Assistant Attorneys General James Morrissey of the Buffalo Regional Office and Cydney Kelly of the Criminal Prosecutions Bureau. Senior Investigator Harold Frank assisted in the investigation. The Attorney General also thanked the New York State Police, the Federal Bureau of Investigation, and the United States Attorney for the Western District of New York for their help with the investigation.

 mortgage fraud

   

Posted by Interthinx on 04/28/06 at 07:23 AM
Mortgage Fraud LocationsNew York • Total comments: (1) (0) Trackbacks
  1. I DONT UNDERSTAND HOW SOME PEOPLE IN THE BUISNESS CAN BE SO GREEDY AND GO OVER THAT BOUNDARY LINE AND STEAL . I MYSELF BEING A SUCCESSFULL TITLE INSURANCE SALESMAN AND CLOSER AM PROUD TO SAY IVE MADE AN EXCELLENT LIVING WITH ONE BIG DIFFERENCE . I DID IT THE HONEST WAY AND I FEEEL GREAT ABOUT THAT. THE FEW BAD APPLES IN THE BUISNESS SPOIL THE REPUTATION OF MANY OF US GOOD GUYS . I HAVE A TERRIFIC LIFESTYLE ,AS GOOD IF NOT BETTER THAN THE CROOKS BUT I DID IT THE HONEST WAY ,WORKING VERY HARD ,YR AFTER YR. THE GUYS WHO KICK BACK WILL NEVER KNOW WHAT IT TRULY FEELS LIKE TO BE A PERSUASIVE SUCCESSFULL SALEMAN LIKE MYSELF BECAUSE THEY BUY THERE BUISNESS WITH KICKBACKS . COWARDS ! .I AS A SALESMAN A TRUE SALESMAN EXPERIENCE MANY MANY MANY AND MANY MORE REJECTIONS THAN YES ES BUT THATS THE NATURE OF SALES. 100 NO S TO 1 YES BUT THAT 1 YES EQUALS A CLIENT WHO EQUALS ,GIVE TERRIFIC SERVICE WHICGH EQUALS VERY NICE HONEST MONEY .

    Posted by  on  05/03  at  12:13 PM

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mortgage fraud news



Today's News

Some Sources require Registration.

 

Mortgage Scam Ends with Prison
The Morning Call
A judge didn't hold back when Shirley Matthews appeared before him Tuesday to be sentenced for stealing from a Monroe County man instead of helping him save his home from foreclosure, as she was hired to do.

Woman Gets Prison Time After Mortgage Scam Conviction
Pocono Record
A New Jersey woman will be spending two to five years in state prison after she was sentenced on Tuesday for promising to help homeowners avoid foreclosure and then keeping the money she was given for their mortgages.

2 Indicted in Mortgage Scam Face New Charges
Newsday.Com
Prosecutors add extra charges to two who are charged in LI mortgage fraud with county legislator, dominatrix and her husband

Untangling Mortgage Fraud in Chicago Condo Buildings
Chicago Public Radio
Why did so many units go into foreclosure all at once? In some cases, the reason can be traced to mortgage fraud.

No Contest Plea Entered in Real Estate Fraud Case
Northbay Business Journal
Juan Carlos Alcala of Windsor pleaded no contest to nineteen felony counts and admitted three special allegations for defrauding real estate investors, money laundering and elder fraud.

Bedford Woman Sentenced to a Year in Prison for Mortgage Fraud
Plain Dealer
Sharon Cox, 49, of Bedford, was sentenced today to a year in prison for mortgage fraud involving money laundering, theft and receiving stolen property from August 2008 through March.

CITIZEN JOURNALISM: Mortgage Fraud High in Area
Washington Times
According to the FBI, Virginia, Maryland and the District are among the top 10 jurisdictions experiencing mortgage fraud.

Former Vegas Resident Charged with Mortgage Fraud in Nevada
National Mortgage Professional Magazine
A former Las Vegas resident has been charged with federal conspiracy and fraud charges for his involvement in a Nevada mortgage fraud scheme involving straw buyers and falsified mortgage loan documents...

Missouri Man Sentenced for Mortgage Fraud
Belleville News Democrat
A suburban St. Louis mortgage company operator has been sentenced to more than 11 years in prison for a mortgage fraud scheme.

12-Year Prison Term in Mortgage Swindle
Washington Post
A Maryland woman who stole millions from Washington area homeowners trying to avoid foreclosure is a "vulture" whose case should serve as a warning to other con artists...

Previous Articles

TRIAL COVERAGE

Trial coverage provided by Anne Mitchell, Crazy Fish Realty.

F. Jeffrey Miller Update - October 20, 2009

A hearing was held in Topeka, Kansas in front of Judge Julie Robinson. Miller is currently being held pending his sentencing which is set for December 22nd, 2009 at 9:00 a.m.. Steve Vanatta and Hallie Irvin, Miller's codefendants, will be sentenced at that time also.

Several motions were heard this week. One was a motion for Miller to be released pending his sentencing. Miller's attorney, Jeff Morris, argued that the court had dismmissed with predjudice the matter involving Miller's purchase of a commercial lawnmower, violating the court ordered monitoring agreement. He also argued that Miller was not a flight risk and should be released. This motion was denied

Another motion heard by Judge Robinson was that of an escrow account containing proceeds from the sale of Miller's forfeited assets. This account has a balance of $143,000. Attorney Morris argued that his firm was due $100,000 for work done in the Miller matter, to date. The government argued that his 'un-itemized fees' were 'exhorbitant'. The balance of the funds, Morris argued, should be released to the Miller family to help pay for mounting household expenses.

The government argued that the 'Asset Forfeiture Provision' applies down to 'the last penny' and that 'the rights of the victims to made whole are of paramount immportance' and that no routine household expenses like Visa bills, are allowed.

Attorney Morris argues that there is more than enough assets to satisfy the jury's judgement of $2.65 million dollars. The government argues that the estimated value of his assets are only $1.4 million.

The government also stated that Miller has been paid dividends from a company Miller has an ownership interest in; Boreflex. From July, 2008 to present, Miller has been paid $330,509.30 from Boreflex, unbeknownst to the court appointed monitor.

Present in the courtroom was Todd Earnshaw. Earnshaw was indicted along with Miller and others in what is commonly referred to as 'Miller I'. That trial is scheduled to begin on January 11, 2010 in Topeka, Kansas.



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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.

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