Mortgage Fraud – A Family Affair

Allison Tussey —  February 5, 2012 — Leave a comment

Ivania Filgueiras, 40, Miami, Florida; Jose Armando Alvarado, 62, Miami; Maria C. Alvarado, 62, Miami; Reyna Josefina Orts, 57, Miami; Alberto Morejon, 25, Miami; and Carlos Serrano, 56, Hialeah, Florida, in a mortgage fraud scheme that resulted in approximately $2 million in fraudulent loans. Five of the six defendants are close family members. 

On February 2, 2012, a ten-count indictment was unsealed charging six defendants for their alleged participation in a mortgage fraud scheme that resulted in approximately $2 million in fraudulent loans.  Charged in the indictment are defendants

According to the indictment, from 2005 through 2009, defendants Filgueiras, Jose Armando Alvarado, and Maria C. Alvarado identified residential properties in Miami-Dade County to defraud lenders.  Defendant Jose Armando Alvarado then recruited and paid individuals to act as straw buyers of the properties.  Defendant Serrano acted as a straw borrower for three (3) different properties alleged in the indictment. 

Defendants Jose Armando Alvarado and Orts created and caused the borrowers’ fraudulent loan applications and other documents to be submitted to the lenders, in one instance without a borrower’s knowledge or consent.  The fraudulent loan applications contained bogus bank account records and false statements about employment, income, assets, and intent to occupy the property.  American Mortgage Lending (AML), a mortgage brokerage firm owned by defendant Jose Armando Alvarado, prepared and submitted the fraudulent loan documents to the lenders.  South Florida Realty, a real estate company owned by defendant Maria C. Alvarado, was utilized to create sales contracts submitted to the lenders for the charged transactions.

Thereafter, defendants Filgueiras and Morejon utilized a Miami title company to conduct fraudulent closings.  Once the mortgage applications were approved, the lenders wired the loan proceeds to the title company’s escrow account, operated by Filgueiras, for closing.  At closing, Filgueiras and her father, defendant Jose Armando Alvarado, caused fraudulent payments and disbursements to be made from the loan proceeds. 

Additionally, defendant Filgueiras disbursed loan proceeds to the sellers without receiving cash-to-close payments from the borrowers, contrary to representations on the HUD-1 statements.

To perpetuate the scheme and avoid detection, the defendants also failed to record, and falsely recorded, mortgage deeds and other mortgage documentation with the State of Florida authorities.  Defendants Filgueiras and Morejon also fraudulently executed quit-claim deeds with State of Florida authorities, on behalf of defendants Jose Armando Alvarado and Maria C. Alvarado, in order to sell the properties to other straw buyers, obtain home equity line of credit (HELCO) loans, and conceal the fraud.  The defendants would also make payments on the loans until the properties could be resold, often to another straw borrower, repeating the cycle of fraud.  Eventually, the defendants stopped making payment on the loans and the properties entered foreclosure proceedings, often resulting in substantial losses to the lending institutions.

The indictment charges the defendants with conspiracy to commit bank and wire fraud, and substantive wire fraud and bank fraud. If convicted, the defendants face a statutory maximum term of imprisonment of 30 years’ on the conspiracy to commit bank and wire fraud and substantive bank fraud charge, and 20 years’ imprisonment on the wire fraud charges.

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and James K. Loftus, Director, Miami-Dade Police Department (MDPD), along with members of the Federal-State Mortgage Fraud Strike Force (Mortgage Fraud Strike Force), announced the indictment.

Mr. Ferrer commended the investigative efforts of the Federal-State Mortgage Fraud Strike Force, with special commendation to the Federal Bureau of Investigation and Miami-Dade Police Department.  The case is being prosecuted by Assistant U.S. Attorney Sean T. McLaughlin.

An indictment is only an accusation and a defendant is presumed innocent until proven guilty.

This case is the result of the cooperative law enforcement efforts of the members of the Mortgage Fraud Strike Force.  Created in June 2008 and led by the U.S. Attorney’s Office, the Mortgage Fraud Strike Force brings together federal, state and local law enforcement to combat the mortgage fraud epidemic in South Florida. Members of the Mortgage Fraud Strike Force include experienced prosecutors, federal agents, and state and local officers, dedicated exclusively to investigating and prosecuting mortgage fraud cases.  The Mortgage Fraud Strike Force has yielded substantial results.  Since September 2007, following the creation of the District’s first Mortgage Fraud Initiative, more than 500 individuals have been charged for their involvement in mortgage fraud schemes that have resulted or were intended to result in more than $620 million in mortgage loans.

The case announced is also part of the Department of Justice’s Financial Fraud Enforcement Task Force.  This national task force was established in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. Mortgage fraud is a key focus of the Financial Fraud Enforcement Task Force’s efforts. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

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Allison Tussey

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