Kara McIntosh, 46, Bethesda, Maryland, pleaded guilty to mail fraud arising from the fraudulent purchase of properties in Maryland and the District of Columbia using false mortgage documents.
According to the plea agreement, McIntosh, Timothy Reed and others recruited straw buyers to purchase houses. McIntosh knew the straw purchasers were not planning to live in the properties and did not qualify for the home mortgages. Some of the straw buyers purchased multiple properties at the same time. To enable straw buyers to purchase the properties, McIntosh was paid to prepare fraudulent mortgage applications which misrepresented the straw buyers’ income and assets. McIntosh also received part of the fraudulently obtained mortgage funds. For example, at one closing, McIntosh falsely claimed $109,600 for “renovations” that her company, Washington Finance Group, purportedly performed. No such renovations ever occurred.
Beginning in 2006, this scheme involved fraudulent loans worth over $19,021,366. Over 10 individuals and banks were harmed. The loss amount foreseeable to McIntosh is between $2.5 and $7 million. Many of the purchased properties have been foreclosed upon.
McIntosh faces a maximum sentence of 30 years in prison. U.S. District Judge J. Frederick Motz has not yet scheduled her sentencing.
Timothy Reed, 43, Beltsville, Maryland, pleaded guilty on February 10, 2009 to the same offense. No date has been scheduled for his sentencing. To date, four defendants have pleaded guilty to their participation in this scheme.
United States Attorney for the District of Maryland Rod J. Rosenstein made the announcement. This prosecution has been brought as part of the Maryland Mortgage Fraud Task Force, a group of more than 15 federal, state and local law enforcement agencies in Maryland. The Task Force was formed to promote the early detection, identification, prevention, and prosecution of various kinds of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of Maryland’s law enforcement agencies to protect consumers from fraud and help to ensure the integrity of the mortgage market and other credit markets. Information about mortgage fraud prosecutions is available on the internet at http://www.usdoj.gov/usao/md/Mortgage-Fraud/index.html.
United States Attorney Rod J. Rosenstein thanked the U.S. Postal Inspection Service, the Federal Bureau of Investigation, the Montgomery County State’s Attorney’s Office – Economic Crimes Unit and the U.S. Secret Service for their investigative work and assistance. Mr. Rosenstein commended Assistant United States Attorney Kwame J. Manley, who is prosecuting the case.