Eugene Peter Kenworthy, Jr., 50, appraiser, Ambler, Pennsylvania, was charged by Indictment with wire fraud, false statements for the purpose of influencing the Federal Housing Administration, aggravated identity theft, and failure to file a tax return.
The indictment alleges that, beginning as early as 1993, Kenworthy worked at Tech Review LTD, a real estate appraisal company owned by Kenworthy’s father. Kenworthy began managing Tech Review after his father’s death in 2003 and sold the company in 2012 after which he formed two other companies, Global Appraisal Management and East Coast Appraisal Management.
According to the indictment, from March 2010 to February 2016, Kenworthy appraised approximately 714 properties which were the subject of HECM loan applications. Kenworthy used the electronic signatures of five certified appraisers without their knowledge and consent to certify approximately 294 of those appraisals reports. Those appraisers did not appraise the properties or write the reports. Kenworthy used his own signature to certify the other approximately 420 appraisal reports he wrote. Most of the appraisals were for a single mortgage broker/origination company which paid Kenworthy about $450 per appraisal.
Also according to the indictment, Kenworthy made false statements in some of the HECM appraisal reports which resulted in falsely inflated valuations for the properties and, fraudulently inflated the HECM loan amounts. The indictment details several of these transactions.
As of July 2017, of the 714 properties for which Kenworthy wrote an appraisal report for a HECM, FHA had paid 53 claims totaling almost $3.7 million on foreclosed properties where the sales price of the home was insufficient to cover the HECM loan.
Kenworthy was added to the FHA appraiser roster in 1999 and, in or about January 2016, HUD suspended Kenworthy, barring him from performing FHA appraisals.
If convicted the defendant faces a maximum possible sentence is 166 years’ imprisonment, five years of supervised release, a $5,050,000 fine, and a $1,000 special assessment
The indictment was announced Acting United States Attorney Louis Lappen. The case was investigated by the United States Department of Housing and Urban Development – Office of Inspector General and the Internal Revenue Service – Criminal Investigation, and is being prosecuted by Assistant United States Attorney Karen L. Grigsby.