Sergej Tews has been sentenced to 33 months in prison, to be followed by 3 years of supervised release in connection with his participation in a complex foreclosure fraud scheme in which he filed and foreclosed on false mortgages. In addition, Tews was ordered to pay $635,966.20 in restitution, and to forfeit certain monies and his interest in certain property. As previously reported, Tews was Indicted in October of 2008, had pled guilty in February 2009, and was sentenced by U.S. District Court Judge James L. King.
According to the initial indictment and statements made during the plea colloquy, defendant Tews induced homeowners to transfer their properties to him in exchange for his promise to assume their mortgage payments. Tews caused the homeowners to execute warranty deeds, which gave the appearance that the properties were sold to a third party, instead of simply transferred to Tews. In each instance, the person listed on the fraudulent warranty deed as the purported purchaser was a relative of Tews. None of Tews’s relatives provided any money to any of the property owners or made payments on any of the outstanding mortgages.
Upon filing the false deeds, Tews fabricated the amount paid for each property and paid the filing taxes based on the false amount, making it appear as if each property had been purchased in an arm’s length transaction for the falsely represented amount. At the same time that he filed the fraudulent deeds, Tews also filed fraudulent mortgages on each property.
The filed mortgages that Tews had prepared made it appear as though each of Tews’s relatives had borrowed money from lending companies to help finance the alleged purchase of the properties. In fact, however, none of the supposed lending companies had loaned any money in connection with the property transfers. The supposed lending companies actually were companies controlled and incorporated by Tews. Tews paid the filing taxes for each mortgage based on the purported amount being loaned, further suggesting that the mortgages had been funded and were legitimate.
Even though none of Tews’s companies had lent any money to Tews‘ relatives on which they could have defaulted, Tews initiated foreclosure proceedings in the names of his supposed lending companies against his relatives. Between the time that the properties were transferred to Tews’s relatives and shortly after each foreclosure action was initiated, Tews paid the monthly mortgage payments on the actual outstanding mortgages to temporarily forestall the actual, legitimate lenders from foreclosing on the properties.
At the foreclosure sales, third-parties purchasers were deceived by the false warranty deeds and mortgages into believing that there were no pre-existing mortgages on the properties, and bid on and purchased the properties at auction. After the third-party purchasers paid for the properties, the court issued checks to Tews in the names of his purported foreclosing lenders. Tews then deposited the checks into accounts that he had opened in the names of the fake lenders, receiving more than $600,000.
This case was investigated by agencies participating in the Federal-State Mortgage Fraud Strike Force. Mr. Acosta commends the investigative efforts of the Mortgage Fraud Strike Force with particular commendation to the U.S. Secret Service. The case was prosecuted by Assistant US Attorney Joseph B. Shumofsky.