Mark J. Bellotti, 56, Marlboro, New Jersey, a lawyer, was sentenced to prison for his role in a scheme to steal more than $2.6 million from lenders by filing fraudulent mortgage loan applications.
Also charged was an investment broker who was involved in the conspiracy, Jonathan P. Domash, 42, Marlboro, New Jersey, owner of Diversified Assets, LLC, was sentenced to three years of probation. He pleaded guilty on February 21 to a charge of third-degree theft by deception.
The indictment charged Bellotti and Domash in connection with seven mortgage loans totaling $2,671,400. A third defendant named in the indictment, Leonardo A. Hernandez, 41, Hillsborough, New Jersey, pleaded guilty on February 21 to an amended count of the indictment charging theft by deception as a disorderly persons offense. He admitted that he submitted false information and documents in connection with several of the loans. Hernandez faces a sentence of probation.
Bellotti and Domash admitted that they conspired to falsify mortgage loan applications to cause banks to provide loans to unqualified home buyers. The two men were charged in an April 11, 2011 state grand jury indictment stemming from an investigation by the Division of Criminal Justice Financial & Computer Crimes Bureau. Deputy Attorney General Valerie A. Noto prosecuted the defendants and handled the sentencing for the Division of Criminal Justice.
The investigation revealed that Domash, Bellotti and Hernandez falsified information about employment, earnings and bank account balances on mortgage loan applications so that home buyers could obtain loans for which they were not qualified. They also falsified U.S. Department of Housing and Urban Development (HUD) settlement forms.
The investigation also revealed that Domash would find homeowners who were eager to sell, and then convince buyers to invest in the homes as income properties through his company, Diversified Assets, LLC. He had buyers sign blank loan applications, so he and other defendants could falsify the buyers’ personal financial information. Bellotti handled the closings for the home sales, performing separate closings with the buyers and sellers. The defendants inflated the sales prices for the properties and took out huge fees at closing from the loan proceeds. All of the homes ultimately fell into foreclosure, and some purchasers had their credit ruined.
The defendants submitted fraudulent loan applications and HUD documents between April 2006 and June 2007 to obtain mortgage loans in the following amounts for seven homes in these locations: Hillsborough ($540,000), Plainfield ($342,000), Marlboro ($339,150), Keansburg ($351,500), Asbury Park ($384,750), Asbury Park ($374,000), and Newark ($340,000), New Jersey.
Attorney General Jeffrey S. Chiesa made the announcement.
“Lawyers take an oath to uphold the law, but this one repeatedly betrayed his oath and broke the law to turn a quick profit,” said Attorney General Chiesa. “We’re aggressively investigating and prosecuting this type of mortgage fraud.”
“This lawyer and his co-conspirators falsified mortgage applications so they could siphon away big closing fees, while leaving behind a trail of foreclosed properties and borrowers with ruined credit,” said Director Stephen J. Taylor of the Division of Criminal Justice. “We urge people to contact us confidentially to report lawyers and other licensed professionals who commit fraud.”
Charges remain pending against three other individuals who were charged in the indictment for allegedly assisting Bellotti and Domash.
Bellotti was sentenced to five years in prison by Superior Court Judge Anthony J. Mellaci Jr. He was also ordered to pay a fine of $50,000. Bellotti pleaded guilty on February 21 to second-degree charges of conspiracy and theft by deception. His license to practice law in New Jersey has been revoked as a result of the charges
Deputy Attorney General Noto presented the case to the state grand jury. The investigation was conducted and coordinated for the Division of Criminal Justice Financial & Computer Crimes Bureau by Detective Kimberly Allen, Deputy Attorney General Noto, and Supervising Deputy Attorney General Terrence Hull, Chief of the Financial & Computer Crimes Bureau.