Randall Causey, 48, Gary, Indiana, was sentenced by Senior District Judge Rudy Lozano to 108 months imprisonment and 3 years of supervised release after being found guilty at trial of the felony offenses of conspiracy to commit wire fraud and wire fraud.
According to documents filed in this case, Causey engaged in a scheme to defraud and obtain money and property by means of false and fraudulent pretenses. He, along with others, recruited five buyers and talked them into purchasing a combined total of 21 houses in the scheme. Causey told the buyers the houses were good investments despite knowing that the houses were in disrepair and located in unsafe neighborhoods. He told them the houses would be rehabilitated by his company when he knew that little if any of the necessary repairs would actually be done. He told them he would find renters to occupy the houses and maintain and manage the properties thereafter, knowing he would make no effort to do so once the house had sold and the first month or two of the mortgage had been paid.
The lenders were provided false information regarding the buyers’ credit-worthiness and were falsely told buyers had made down payments and taken out seller-second mortgages. As a result, in most of the home sales, the lenders unwittingly approved financing for 100% of the purchase of the homes, leaving no cushion if the housing market declined. The financial institutions to which some of the mortgages were packaged and sold by the initial lenders eventually lost their investment as well, as all of the homes sold in the scheme were eventually foreclosed upon.
This case was the result of an investigation by the Federal Bureau of Investigation. This case was prosecuted by Assistant United States Attorney Jill Koster and Emily Cremeans.