Former R.E. Attorney & Wife Plead Guilty to Mortgage Fraud

Stephanie Abbott —  March 4, 2022 — Leave a comment

Barry Wayne Plunkett Jr., 61, and Nancy Plunkett, 56, both of Hyannis Port, Massachusetts, a former  attorney and his wife pleaded guilty today in federal court in Boston in connection with various mortgage fraud schemes.

Prior to being disbarred in October 2017, Barry Wayne Plunkett Jr. owned and operated the Plunkett Law Firm where his wife, Nancy Plunkett, was his office assistant and paralegal.

The defendants engaged in several bank fraud schemes. In one scheme, from September 2012 to July 2016, the defendants defrauded six mortgage lenders and 14 homeowners for whom the Plunkett Law Firm handled the closings for new mortgage loans to refinance residential properties. The defendants informed the mortgage lenders that pre-existing mortgages were paid off from the new loan proceeds when, in fact, the Plunketts intentionally failed to pay off the prior liens and instead converted more than $900,000 in payoff funds for their own purposes.

In other bank fraud schemes – between April 2015 and March 2018 – the Plunketts fraudulently used various names, entities and false documents to obtain three successive mortgage loans on their home in Hyannis Port in amounts of $412,000, $470,000 and $1.2 million. The defendants pledged as collateral a property in Hyannis Port that was held in a family trust for which Barry Wayne Plunkett Jr. was one of three beneficiaries. Both defendants participated in providing false documents to the lenders, including false title reports and other records to falsely represent that the property was free and clear of existing mortgage liens and forged documents in the names of other people. The defendants also made misrepresentations to a lender that Nancy Plunkett was a single woman living in Wellesley who was purchasing the property in her maiden name as a business investment when, in fact, the defendants had been married since 2014 and the property was their residence.

The charge of bank fraud provides for a sentence of up to 30 years in prison, five years of supervised release and a fine of $250,000. The charge of tax evasion provides for a sentence of up to five years in prison, three years of supervised release and a fine of $250,000. The charge of aggravated identity theft provides for a mandatory two-year sentence to be served consecutively to any other sentence imposed. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

The Plunkett’s pleaded guilty to five counts of bank fraud and one count of aggravated identity theft. Barry Wayne Plunkett Jr. also pleaded guilty to one count of tax evasion. U.S. Senior District Court Judge Mark L. Wolf scheduled sentencing for June 10, 2022. The Plunketts were indicted in July 2020.

United States Attorney Rachael S. Rollins; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; and Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston made the announcement today. Assistant U.S. Attorneys Victor A. Wild and Mackenzie Queenin, of Rollins’ Securities, Financial & Cyber Fraud Unit, and Carol Head, Chief of Rollins’ Asset Recovery Unit, are prosecuting the case.

 

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Woman Previously Convicted in Fraud Scheme Admits to Defrauding the FHA

Stephanie Abbott —  March 2, 2022 — Leave a comment

Juliana Martins, 53, North Providence, Rhode Island, today admitted in federal court that she provided false information to a mortgage lender when applying for a Federal Housing Administration (FHA)-backed mortgage, and that she fraudulently applied for a COVID Economic Injury Disaster Loan (EIDL) and unemployment insurance benefits under both the Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security (CARES) Act, announced United States Attorney Zachary A. Cunha.

Martins was on federal supervised release at the time of the charged fraudulent activities.

At the time of her guilty plea, Martins admitted to the court that while on federal supervised release her role in a stolen identity refund scheme, as well as while on state probation for an unrelated 2014 conviction for forgery and counterfeiting, she applied for an FHA-guaranteed loan. As part of the application process, she provided false explanations as to her gaps in employment while serving her federal sentence, claiming she was unemployed due to a “family emergency.” Martins also failed to disclose the fact that she was subject to a $385,533 federal restitution order.

Following the application, Martins and a co-borrower were issued an FHA-insured mortgage in the amount of $265,109.

Additionally, Martins admitted that in July 2020, she submitted a fraudulent application for a Small Business Administration (SBA) low-interest COVID-related Economic Injury Disaster Loan (EIDL), falsely claiming that she was an independent contractor in the health service business, and that her business had been impacted by the pandemic. Finally, Martins admitted that she fraudulently applied for and received COVID-related unemployment insurance benefits while she was in fact employed as an office manager in April 2020. In total, Martins received over $40,000 in COVID relief benefits to which she was not entitled.

Martins pleaded guilty to false statement on a loan application and theft of government property. She is scheduled to be sentenced on August 4, 2022.

The case is being prosecuted by Assistant U.S. Attorneys G. Michael Seaman and Sandra R. Hebert.

The matter was investigated by the U.S. Department of Housing and Urban Development – Office of Inspector General; U.S. Department of Labor – Office of Inspector General; FBI; and Rhode Island State Police, with the assistance of the Rhode Island Department of Labor and Training Unemployment Insurance Fraud Unit.

Rhode Islanders who believe their personal identification has been stolen and used to fraudulently obtain unemployment benefits are urged to contact the Rhode Island State Police at financialcrimes@risp.gov or the FBI Providence office at (401) 272-8310.

On May 17, 2021, the United States Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

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Paralegal Sentenced For Conspiracy To Commit Mortgage Fraud

Stephanie Abbott —  January 28, 2022 — Leave a comment

Eric Liebman, 34, Tampa, Florida has been sentenced to 15 months in federal prison for conspiracy to commit bankruptcy fraud.

According to court documents, from January 2010 through February 2017, Liebman conspired with his co-defendant, James Lee Clark, to defraud mortgage creditors and guarantors, such as Fannie Mae, which held mortgage notes on properties that were in foreclosure. Liebman and Clark falsely and fraudulently represented to the distressed homeowners facing foreclosure that in exchange for executing quitclaim or warranty deeds for their properties to an entity controlled by Liebman, they would negotiate with the mortgage creditors to prevent foreclosures. Liebman and Clark convinced the distressed homeowners to pay them rent or agree to put their houses up for sale. In order to continue to collect ill-gotten rents, or profit from sales of the properties, Liebman filed fraudulent bankruptcy petitions in the names of the homeowners to prevent the mortgage creditors from lawfully foreclosing and taking title to the properties.

Liebman had pleaded guilty on September 24, 2019.

This case was investigated by the Federal Bureau of Investigation and the Federal Housing Finance Agency – Office of Inspector General. The Office of the United States Trustee for the Middle District of Florida, Tampa Division, also provided substantial investigative support. It was prosecuted by Special Assistant United States Attorney Chris Poor.

 

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Woman Pleads Guilty To Wire Fraud In Connection With Mortgage Fraud Scheme

Stephanie Abbott —  January 27, 2022 — Leave a comment

Tammy Jones, a/k/a “Tammy Taylor”, 53, Upper Marlboro, Maryland, pleaded guilty yesterday to wire fraud in connection with a mortgage fraud scheme.

According to her guilty plea, in May 2011 Jones purchased a home in Brandywine, Maryland.  To finance the purchase of the home, Jones obtained a mortgage for $360,660 from Lender 1, which was backed by the Federal Housing Administration (FHA).

In 2017, Jones sought and received a loan modification for her FHA-insured mortgage through the U.S. Department of Housing and Urban Development (HUD) Partial Claim Program, which is a loan modification program for FHA-insured mortgages.  As part of the Partial Claim Program, HUD works to restructure the borrower’s mortgage payments using a partial claim which allows the borrower to stay in the home.  A lender files a “partial claim” with HUD for a portion of the outstanding mortgage balance and HUD makes payment to the lender on behalf of the borrower for that portion of the mortgage.  In exchange, HUD receives a security interest in the property in the amount of the balance that was paid to the lender and the borrower agrees to repay HUD for the amount of the partial claim.  Thus, the lender is effectively “made whole” by the partial claim payment from HUD.  When the borrower sells the home, the borrower is ultimately responsible for the balance of the partial claim to remove the lien held by HUD.

As stated in her plea agreement, in or around June 2017, Jones sought and received a loan modification through the HUD Partial Claim Program for her Brandywine, Maryland home.  HUD made a partial claim payment to Servicer 1 (who serviced Jones’s FHA-insured mortgage) of $111,377.12 on behalf of Jones.  In exchange, Jones granted HUD a security interest in the Brandywine, Maryland property for $111,377.12, the amount of the partial claim payment made by HUD.  Jones also entered into a loan modification agreement with the mortgage lender, in which Jones owed $352,151.01 in principal and agreed to make monthly payments of $2,564.96.

In 2018, Jones sought to sell the Brandywine, Maryland property for $429,900.  To close the sale of the property, employees of a settlement company sought proof that Jones’s lien from HUD and the FHA had been released.

In fact, the lien had not been released.  Jones thereafter created false and fraudulent documents to make it appear as though the lien had been released in order to facilitate the sale of the Brandywine, Maryland home as part of the scheme.

Specifically, Jones created a fraudulent email account, purporting to be an employee of a company contracted by HUD to service loans on HUD’s behalf.  Jones, posing as an employee of the HUD contractor, told an employee of the settlement company that the lien on the Brandywine, Maryland home had been released and Jones created and attached a bogus lien release document.  Jones thereafter continued to contact the settlement company while posing as an employee of the HUD contractor.  Jones also submitted a fraudulent Certificate of Satisfaction to the settlement company, which permitted the sale of the Brandywine, Maryland property on or about October 19, 2018.

After the sale of the Brandywine, Maryland property closed, the induvial who purchased the home from Jones was notified of the outstanding lien on the property in 2019.  Investigation revealed that Jones had falsified documents and fraudulently posed as an employee of the HUD contractor in order to further her scheme to defraud HUD.

In total, Jones caused a net loss of $111,377.12 to HUD, which represents the partial claim that HUD paid on behalf of Jones in September 2017.

As part of her plea agreement, Jones will be required to pay $111,377.12 in restitution.

Jones faces a maximum sentence of 20 years in prison followed by up to three years of supervised release for wire fraud.  U.S. District Judge Theodore D. Chuang has scheduled sentencing for May 20, 2022 at 2:30 p.m.

The guilty plea was announced by United States Attorney for the District of Maryland Erek L. Barron and Special Agent in Charge Bertrand Nelson of the U.S. Department of Housing and Urban Development Office of Inspector General.

United States Attorney Erek L. Barron commended HUD-OIG for their work in the investigation.  Mr. Barron thanked Assistant U.S. Attorney Caitlin R. Cottingham, who is prosecuting the case.

For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.

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R.E. Agent Sentenced for Running Multi-Year Mortgage Fraud Schemes

Stephanie Abbott —  January 21, 2022 — Leave a comment

Eric Hill, 52, Tyrone, Georgia, an Atlanta real estate agent has been sentenced for his participation in a mortgage fraud scheme that netted more than $21 million in fraudulent mortgage loans.

According to the charges and other information presented in court: The defendants participated in a scheme in which homebuyers and real estate agents submitted fraudulent loan applications to induce mortgage lenders to fund mortgages.  Eric Hill and Robert Kelske were real estate agents who represented a major nationwide homebuilder.  Hill and Kelske helped more than 100 homebuyers who were looking to buy a home, but who were unqualified to obtain a mortgage, commit fraud.  The agents instructed the homebuyers as to what type of assets they needed to claim to have in the bank, and what type of employment and income they needed to submit in their mortgage applications.

Hill and Kelske then coordinated with multiple document fabricators, including defendants Fawziyyah Connor and Stephanie Hogan, who altered the homebuyers’ bank statements to inflate their assets and to create bank entries reflecting false direct deposits from an employer selected by the real estate agent.  The document fabricators also generated fake earnings statements that matched the direct deposit entries to make it appear that the homebuyer was employed, and earning income, from a fake employer.  Other participants in the scheme then acted as employment verifiers and responded to phone calls or emails from lenders to falsely verify the homebuyers’ employment.  Defendants Jerod Little, Renee Little, Maurice Lawson, Todd Taylor, Paige McDaniel and Donald Fontenot acted as employment verifiers.  Hill and Kelske coordinated the creation and submission of the false information so that the lies to the lenders were consistent.

In another aspect of the scheme, Hill and Kelske conspired with real estate agents Anthony Richard and Cephus Chapman, who falsely claimed to represent homebuyers as their selling agents in order to receive commissions from the home sales.  In reality, these real estate agents had never even met the homebuyers they claimed to represent.  To avoid detection, the agents often notified closing attorneys that they would not be available for the home closing and sent wire instructions for the receipt of their commissions.  When these purported selling agents received their unearned commissions, they kicked back the majority of the commissions to Hill or Kelske for enabling them to be added to the deal, keeping a small share for their role in the scheme.

Many of the fraudulent loans were insured by the Federal Housing Administration (FHA), resulting in over $850,000 in claims being paid for mortgages that have defaulted.  Hill also engaged in a scheme to defraud his employer, a national real estate developer, out of over $480,000 dollars in real estate commissions.

Hill was sentenced to two years, six months in prison to be followed by three years of supervised release.  Hill was convicted on these charges on September 21, 2020, after he pleaded guilty.

In addition to Hill, Defendants Donald Fontenot, Maurice Lawson, Stephanie Hogan, Jerod Little, Renee Little, Paige McDaniel, Fawziyyah Connor, and Anthony Richard have all been sentenced for their roles in the conspiracies.

  • Todd Taylor pled guilty and is scheduled to be sentenced on March 3, 2022.
  • Robert Kelske also pled guilty and is scheduled to be sentenced April 14, 2022.
  • Cephus Chapman was convicted at trial and is scheduled to be sentenced on February 10, 2022.

“Eric Hill and his co-conspirators defrauded mortgage loan holders out of millions of dollars, with taxpayers being saddled with much of the loss,” said U.S. Attorney Kurt R. Erskine.  “We will vigorously prosecute those who commit mortgage fraud and enrich themselves at the expense of financial institutions and government programs that insure or guarantee the loans.”

“While it is easy to dismiss financial fraud cases as victimless crimes because of their lack of violence, there is, however, very real victimization to our economy and our taxpayers,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “This sentencing sends the message that the FBI will persistently work to protect American citizens and the real estate market from predators who drag down our economy by deception for their own personal gain.”

“Eric Hill engaged in premeditated criminal acts with the sole purpose of enriching himself, without regard for millions of American homebuyers who rely on federal housing programs to insure their mortgages. His fraudulent actions strike not only at the fiscal integrity of the FHA, but also our neighbors and communities who are victims of these schemes,” said Special Agent in Charge Wyatt Achord with the Department of Housing and Urban Development Office of Inspector General.

“The Federal Housing Finance Agency, Office of Inspector General (FHFA-OIG) is committed to holding accountable those who commit fraud in the housing and mortgage market and abuse the resources of the Government-Sponsored Enterprises regulated by FHFA.  We are proud to have partnered with HUD-OIG, the FBI, and the U.S. Attorney’s Office for the Northern District of Georgia in this case,” said Edwin S. Bonano, Special Agent-in-Charge, FHFA-OIG, Southeast Region.

This case was investigated by the Department of Housing and Urban Development Office of the Inspector General, Federal Bureau of Investigation, and Federal Housing Finance Agency Office of Inspector General.

Assistant U.S. Attorneys David A. O’Neal, Alison B. Prout, and former Northern District of Georgia Assistant U.S. Attorney Ryan Huschka prosecuted the case.

For further information please contact the U.S. Attorney’s Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016.  The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.

 

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R.E. Agent Sentenced For Running Multi-Year Mortgage Fraud Scheme

Stephanie Abbott —  January 21, 2022 — Leave a comment

Eric Hill, 52, Tyrone, Georgia, an Atlanta real estate agent, has been sentenced for his participation in a mortgage fraud scheme that netted more than $21 million in fraudulent mortgage loans.  Many of the fraudulent loans were insured by the Federal Housing Administration (FHA), resulting in over $850,000 in claims being paid for mortgages that have defaulted.  Hill also engaged in a scheme to defraud his employer, a national real estate developer, out of over $480,000 dollars in real estate commissions.

According to the charges and other information presented in court: The defendants participated in a scheme in which homebuyers and real estate agents submitted fraudulent loan applications to induce mortgage lenders to fund mortgages.  Eric Hill and Robert Kelske were real estate agents who represented a major nationwide homebuilder.  Hill and Kelske helped more than 100 homebuyers who were looking to buy a home, but who were unqualified to obtain a mortgage, commit fraud.  The agents instructed the homebuyers as to what type of assets they needed to claim to have in the bank, and what type of employment and income they needed to submit in their mortgage applications.

Hill and Kelske then coordinated with multiple document fabricators, including defendants Fawziyyah Connor and Stephanie Hogan, who altered the homebuyers’ bank statements to inflate their assets and to create bank entries reflecting false direct deposits from an employer selected by the real estate agent.  The document fabricators also generated fake earnings statements that matched the direct deposit entries to make it appear that the homebuyer was employed, and earning income, from a fake employer.  Other participants in the scheme then acted as employment verifiers and responded to phone calls or emails from lenders to falsely verify the homebuyers’ employment.  Defendants Jerod Little, Renee Little, Maurice Lawson, Todd Taylor, Paige McDaniel and Donald Fontenot acted as employment verifiers.  Hill and Kelske coordinated the creation and submission of the false information so that the lies to the lenders were consistent.

In another aspect of the scheme, Hill and Kelske conspired with real estate agents Anthony Richard and Cephus Chapman, who falsely claimed to represent homebuyers as their selling agents in order to receive commissions from the home sales.  In reality, these real estate agents had never even met the homebuyers they claimed to represent.  To avoid detection, the agents often notified closing attorneys that they would not be available for the home closing and sent wire instructions for the receipt of their commissions.  When these purported selling agents received their unearned commissions, they kicked back the majority of the commissions to Hill or Kelske for enabling them to be added to the deal, keeping a small share for their role in the scheme.

“Eric Hill and his co-conspirators defrauded mortgage loan holders out of millions of dollars, with taxpayers being saddled with much of the loss,” said U.S. Attorney Kurt R. Erskine.  “We will vigorously prosecute those who commit mortgage fraud and enrich themselves at the expense of financial institutions and government programs that insure or guarantee the loans.”

“While it is easy to dismiss financial fraud cases as victimless crimes because of their lack of violence, there is, however, very real victimization to our economy and our taxpayers,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “This sentencing sends the message that the FBI will persistently work to protect American citizens and the real estate market from predators who drag down our economy by deception for their own personal gain.”

“Eric Hill engaged in premeditated criminal acts with the sole purpose of enriching himself, without regard for millions of American homebuyers who rely on federal housing programs to insure their mortgages. His fraudulent actions strike not only at the fiscal integrity of the FHA, but also our neighbors and communities who are victims of these schemes,” said Special Agent in Charge Wyatt Achord with the Department of Housing and Urban Development Office of Inspector General.

“The Federal Housing Finance Agency, Office of Inspector General (FHFA-OIG) is committed to holding accountable those who commit fraud in the housing and mortgage market and abuse the resources of the Government-Sponsored Enterprises regulated by FHFA.  We are proud to have partnered with HUD-OIG, the FBI, and the U.S. Attorney’s Office for the Northern District of Georgia in this case,” said Edwin S. Bonano, Special Agent-in-Charge, FHFA-OIG, Southeast Region.

Hill was sentenced to two years, six months in prison to be followed by three years of supervised release.  Hill was convicted on these charges on September 21, 2020, after he pleaded guilty.

In addition to Hill, Defendants Donald Fontenot, Maurice Lawson, Stephanie Hogan, Jerod Little, Renee Little, Paige McDaniel, Fawziyyah Connor, and Anthony Richard have all been sentenced for their roles in the conspiracies.

  • Todd Taylor pled guilty and is scheduled to be sentenced on March 3, 2022.
  • Robert Kelske also pled guilty and is scheduled to be sentenced April 14, 2022.
  • Cephus Chapman was convicted at trial and is scheduled to be sentenced on February 10, 2022.

This case was investigated by the Department of Housing and Urban Development Office of the Inspector General, Federal Bureau of Investigation, and Federal Housing Finance Agency Office of Inspector General.

Assistant U.S. Attorneys David A. O’Neal, Alison B. Prout, and former Northern District of Georgia Assistant U.S. Attorney Ryan Huschka prosecuted the case.

For further information please contact the U.S. Attorney’s Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016.  The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.

 

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State’s Attorney Facing Perjury & False Mortgage Application Charges

Stephanie Abbott —  January 13, 2022 — Leave a comment

Marilyn J. Mosby, 41, Baltimore, Maryland, was indicted today on federal charges of perjury and making false mortgage applications, relating to the purchases of two vacation homes in Florida.

According to the four-count indictment, on May 26, 2020 and December 29, 2020, Mosby submitted “457(b) Coronavirus-Related Distribution Requests” for one-time withdrawals of $40,000 and $50,000, respectively, from City of Baltimore’s Deferred Compensation Plans.  In each request, the indictment alleges that Mosby falsely certified that she met at least one of the qualifications for a distribution as defined under the CARES Act, specifically, that she experienced adverse financial consequences from the Coronavirus as a result of being quarantined, furloughed, or laid off; having reduced work hours; being unable to work due to lack of childcare; or the closing or reduction of hours of a business she owned or operated.  In signing the forms, Mosby “affirm[ed] under penalties for perjury the statements and acknowledgments made in this request.”  The indictment alleges that Mosby did not experience any such financial hardships and in fact, Mosby received her full gross salary of $247,955.58 from January 1, 2020 through December 29, 2020, in bi-weekly gross pay direct deposits of $9,183.54.

Further, the indictment alleges that on July 28, 2020 and September 2, 2020, as well as on January 14, 2021 and February 19, 2021, Mosby made false statements in applications for a $490,500 mortgage to purchase a home in Kissimmee, Florida and for a $428,400 mortgage to purchase a condominium in Long Boat Key, Florida.  As part of both applications, Mosby was required to disclose her liabilities.  Mosby did not disclose on either application that she had unpaid federal taxes from a number of previous years and that on March 3, 2020, the Internal Revenue Service (IRS) had placed a lien against all property and rights to property belonging to Mosby and her husband in the amount of $45,022, the amount of unpaid taxes Mosby and her husband owed the IRS as of that date.  In each application, Mosby also responded “no” in response to the question, “Are you presently delinquent or in default on any Federal debt or any other loan, mortgage, financial obligation, bond, or loan guarantee,” even though she was delinquent in paying federal taxes to the IRS.

Finally, according to the indictment, one week prior to closing on the Kissimmee vacation home, on or about August 25, 2020, Mosby executed an agreement with a vacation home management company giving the management company control over the rental of the property she ultimately purchased in Kissimmee.  On September 2, 2020, Mosby signed a “second home rider” which provided, among other things, that the borrower occupy and use the property as their second home; that the borrower maintain exclusive control over the ownership of the property, including short-term rentals, and not subject the property to any…agreement that requires the borrower either to rent the property or give a management firm or any other person or entity any control over the occupancy or use of the property; and that the borrower keep the property available primarily as a residence for their personal use and enjoyment for at least one year, unless the lender otherwise agrees in writing.  The indictment alleges that by falsely executing the “second home rider” Mosby could obtain a lower interest rate on the mortgage for the property than she would have received without it.

If convicted, Mosby faces a maximum sentence of five years in federal prison for each of two counts of perjury and a maximum of 30 years in federal prison for each of two counts of making false mortgage applications.  Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

An indictment is not a finding of guilt.  An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.

The defendant will have an initial appearance in U.S. District Court in Baltimore, but the hearing has not yet been scheduled.

The indictment was announced by United States Attorney for the District of Maryland Erek L. Barron; Special Agent in Charge Thomas J. Sobocinski of the Federal Bureau of Investigation, Baltimore Field Office; and Special Agent in Charge Darrell J. Waldon of the Internal Revenue Service – Criminal Investigation, Washington, D.C. Field Office.

United States Attorney Erek L. Barron commended the FBI and IRS-CI for their work in the investigation.  Mr. Barron thanked Assistant U.S. Attorneys Leo J. Wise, Sean R. Delaney, and Aaron S.J. Zelinsky, who are prosecuting the federal case.

For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.

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Man Sentenced for Quit Claim Deed Forgery

Stephanie Abbott —  January 13, 2022 — Leave a comment

Arondo Harris, Missouri, has been sentenced to a term of 41 months in federal prison for the filing of counterfeit quit claim deeds with the City of St. Louis Recorder of Deeds Office.

According to court documents, between January 9, 2019 and February 6, 2019, Harris presented to the City of St. Louis Recorder of Deeds Office three quit claim deeds that contained the forged signatures of the properties’ true owners. Each of the forged signatures had had been falsely authenticated through the seal and forged signature of a licensed notary public.  The property owners of one of the residences had died prior to the forgery of their signatures.

As a result of the false notarization of the quit claim deeds, representatives of the Recorders Office accepted the deeds as legitimate and falsely recorded Harris as the owner of three residences located in the City of St. Louis.

The Court determined that Harris’ conduct resulted in losses of more than $150,000 to the legitimate owners of the properties. It also determined that Harris caused substantial financial hardship to one of the victims because that individual was left homeless by the fraudulent activities.

This case was investigated by the United States Postal Inspection Service and was prosecuted based upon a referral by the Circuit Attorney’s Office for the City of St. Louis.

 

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Man Indicted for Alleged Title Theft

Stephanie Abbott —  January 4, 2022 — Leave a comment

James Effiwatt, 64, Brooklyn, New York has been arraigned on an indictment in which he is charged with grand larceny and burglary for allegedly filing a fake deed to transfer ownership of his landlord’s $759,000 rental property to a trust in the defendant’s name.

According to the investigation, on January 15, 2021, Effiwatt allegedly recorded a deed to a three-story house at 36 Hubbard Place, Brooklyn, New York that transferred the title of the property from the owner, Hubbard Estates LLC, to an entity called the “Ayonkladd Trust,” of which the defendant was the trustee. The deed was allegedly signed by Effiwatt as a grantor despite the fact that the defendant is not a member or trustee of Hubbard Estates LLC. The building has an assessed value of $759,000. The property has been owned by the legitimate owner, a 49-year-old woman, since 2015.

The investigation revealed that Effiwatt is a former tenant of 36 Hubbard Place who lived in the third-floor attic apartment for several years beginning in August 2015. Effiwatt allegedly stopped paying rent in the summer of 2017 and was eventually ordered to vacate the property in October 2019 by city housing officials over housing code violations. However, it is alleged that Effiwatt subsequently moved back into the attic apartment where he has remained since. Additionally, beginning in March 2021, Effiwatt allegedly approached several other tenants of the property and demanded they pay him rent. Effiwatt also allegedly approached a real estate broker and discussed selling the property for six or seven hundred thousand dollars.

Brooklyn District Attorney Eric Gonzalez today made the announcement.

District Attorney Gonzalez said, “This defendant allegedly filed a fake deed in an unlawful attempt to take ownership of his landlord’s property. Title theft is a serious crime that deprives hard-working people of the single most important asset any American can hope to own. As real estate values continue to rise dramatically in Brooklyn, I remain committed to protecting homeowners across the borough from fraudsters who would steal their security and investment in the future.”

The defendant was arraigned today before Brooklyn Supreme Court Justice Danny Chun on an indictment in which he is charged with one count of second-degree burglary, one count of second-degree grand larceny and two counts of fourth-degree attempted grand larceny. The defendant was ordered held on bail of $25,000 bond or $10,000 cash and to return to court on February 15, 2022.

The case is being prosecuted by Assistant District Attorney Francis Longobardi, Special Counsel to the District Attorney’s Real Estate Frauds Unit, under the supervision of Assistant District Attorney Richard Farrell, Unit Chief, Assistant District Attorney Gregory Pavlides, Chief of the Frauds Bureau, Assistant District Attorney Michel Spanakos, Deputy Chief of the Investigations Division and the overall supervision of Assistant District Attorney Patricia McNeill, Chief of the Investigations Division.

 

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Attorney & Settlement Agent Admits Role in Reverse Mortgage Fraud Scheme

Stephanie Abbott —  December 17, 2021 — Leave a comment

Martin D. Eagan, 50, Montville, New Jersey, today admitted his role in a reverse mortgage fraud scheme that exploited several elderly homeowners.

According to documents filed in this case and statements made in court:

Eagan, principal of the Martin D. Eagan Law Firm, was an attorney licensed by the state of New Jersey with a practice in Morristown, New Jersey, that primarily focused on real estate transactions, such as loan originations, reverse mortgages and the refinancing of residential homes.

From 2007 through 2010, Eagan, acting as a settlement agent, was required to comply with instructions established by financial institutions that provided loan funds to borrowers. As part of the lending process, Eagan was required to generate and certify HUD-1 settlement statements that Eagan submitted to lenders. The HUD-1 settlement statement itemized the receipt and disbursement of all funds for each real estate closing. HUD-1 settlement statements were required to be approved by a lender before a settlement agent could disburse funds. The disbursement of funds had to mirror the representations made on the lender-approved HUD-1.

Eagan and his conspirators submitted fraudulent documentation to lenders to persuade lenders to approve and fund reverse mortgages and the refinancing of existing mortgages. Fraudulent documentation submitted included false HUD-1s that concealed from the lenders the fact that disbursements of loan proceeds went to conspirators, or entities the conspirators owned or controlled, and false appraisals that overstated the value of homes.

Eagan, his conspirators, and others controlled the loan application process from the time the homeowners applied for loans to the disbursement of loan funds, and ultimately through the diversion of loan proceeds to conspirators.

Eagan pleaded guilty before U.S. District Judge Anne E. Thompson to an information charging him with one count of conspiracy to commit bank fraud.

The conspiracy to commit bank fraud carries a maximum potential penalty of 30 years in prison and a $1 million fine. Sentencing is scheduled for April 14, 2022.

U.S. Attorney Philip R. Sellinger made the announcement.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, and special agents of the Federal Housing Finance Agency, Office of Inspector General, under the direction of Special Agent in Charge Robert Manchak, with the investigation leading to today’s guilty plea.

The government is represented by Special Assistant U.S. Attorneys Kevin Di Gregory and Charlie L. Divine of the Federal Housing Finance Agency, Office of Inspector General.

 

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