Condominium Development Owner Charged with Defrauding Lenders

Allison Tussey —  December 12, 2011 — Leave a comment

Leo Desire, Sr., 51, Brockton, Massachusetts, was charged in federal court with defrauding mortgage lenders in connection with the purchase of nine Boston condominium units.

Desire was charged with 16 counts of wire fraud and two counts of aggravated identity theft. The indictment alleges that in 2006, Desire offered to purchase nine condominium units located at 28, 30 and 32 Cobden Street, Roxbury, Massachusetts, from a developer. Before that sale closed, Desire allegedly orchestrated the straw purchase of each of the nine units with fraudulently obtained financing. According to the indictment, Desire used some of the mortgage fraud proceeds to pay the purchase price to the developer, and the remaining proceeds were distributed to Desire and his associates.

The indictment charges that, for each property, Desire caused the submission of false mortgage loan applications which, among other things, falsely represented that the property would be the borrower’s primary residence. Desire also caused the creation of false documents, including earnings statements, Forms W-2 and bank statements, and caused those false documents to be submitted to mortgage lenders in support of loan applications. No payments were made on any of the mortgages and the nine Cobden Street units were ultimately foreclosed upon.

If convicted on these charges, Desire faces up to 20 years in prison to be followed by up to three years of supervised release and a $250,000 fine on each of the wire fraud counts. If convicted on the aggravated identity theft counts, the minimum mandatory sentence is two years in prison, on and after any sentence for wire fraud.

United States Attorney Carmen M. Ortiz and Steven Ricciardi, Special Agent in Charge of the U.S. Secret Service made the announcement. The case is being prosecuted by Assistant U.S. Attorney Kristina E. Barclay and Special Assistant U.S. Attorney Andrea D. Roller of Ortiz’s Economic Crimes Unit.

The details contained in the indictment are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Mortgage fraud is a key focus of the Department of Justice. The Department, alongside its federal, state and local partners, is committed to investigating and prosecuting significant financial crimes and to combating discrimination and fraud in the lending and financial markets, and recovering proceeds for victims of financial crimes.

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Allison Tussey

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