Short Sale Fraud Indictment Alleging Non-Arms Length Transaction

Rachel Dollar —  January 16, 2018 — Leave a comment

Gary P. DeCicco, 59, Nahant, Massachusetts, and Pamela M. Avedisian, 54, Nahant, Massachusetts, were charged in an indictment with one count of conspiracy to commit wire fraud and one count of wire fraud in connection with the “short sale” of a house in Nahant, Massachusetts. DeCicco was also charged with one count of conspiracy to commit bank fraud, one count of bank fraud, four counts of wire fraud and attempted wire fraud, and six counts of engaging in unlawful monetary transactions.

DeCicco has been in federal custody since he was charged in March 2017 with attempted extortion in connection with arranging and paying for a local business owner to be assaulted. DeCicco and Avedisian made an initial appearance in federal court in Boston and will be arraigned on Tuesday, January 16, 2018.

The indictment alleges that Avedisian owned a property in Nahant that was subject to a mortgage in excess of $1 million.  In October 2015, DeCicco and Avedisian allegedly conspired to defraud the mortgage holder by proposing the sale of the property for significantly less than the outstanding mortgage, in what is commonly referred to as a “short sale.”  By their very nature, short sales are intended to be arms-length transactions in which the buyers and sellers are unrelated and act independently, allowing sellers to cede their ownership of the property in exchange for the short-selling bank’s agreement to release them from their unpaid mortgage debt.  In order to get approval for the sale, DeCicco and Avedisian concealed their long-term romantic and business relationships from the loan servicing company and falsely represented that Avedisian could no longer make payments towards the mortgage on the property.  In fact, just two months before the “short sale” closed, Avedisian purportedly received $3.5 million from the sale of another asset to DeCicco.

The indictment also alleges that from November 2015 to September 2016, DeCicco and a co-conspirator falsified rent rolls and prepared fake leases, which they then provided to financial institutions in support of their applications for a $5.5 million loan secured by a commercial building in Peabody.  The indictment further alleges that between September 2016 and January 2017, DeCicco committed unlawful monetary transactions with the proceeds of the bank fraud scheme, and between February and December 2016, DeCicco engaged in a scheme to defraud multiple insurance companies using fake invoices and other documents to support his claims.

The charges of wire fraud and conspiracy, as well as bank fraud and conspiracy, provides for a sentence of no greater than 30 years in prison, three years of supervised release and a fine of $250,000.  The charges of wire fraud and attempted wire fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000.  The charge of engaging in unlawful monetary transactions provides for a sentence of no greater than 10 years in prison, three years of supervised release and a fine of $250,000.

United States Attorney Andrew E. Lelling; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today.  Assistant U.S. Attorney Kristina E. Barclay of Lelling’s Public Corruption and Special Prosecutions Unit is prosecuting the case.

 

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Rachel Dollar

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