Title Agent Indicted In Mortgage Fraud Scheme

admin —  August 13, 2009 — Leave a comment

Jay Leonard, 43, Alexandria, Virginia, has been indicted by a federal grand jury for mail and wire fraud in connection with scheme involving the fraudulent purchase of 25 properties in Maryland, the District of Columbia and Virginia and a scheme to solicit investors for a resort property that did not exist, announced United States Attorney for the District of Maryland Rod J. Rosenstein.

According to the nine count indictment, February 2006 through September 2008, Leonard, a title agent, working with co-conspirator Osman Al-Bari and others, solicited funds from victims in Maryland for a $10 million spa resort in Spotsylvania County, Virginia, that Leonard, Al-Bari and others claimed they were developing. According to the indictment, Leonard used his position as title agent and falsely claimed that he was doing a closing for the spa resort. Based on those allegedly false representations, the Maryland victims transferred $478,000 to Leonard’s bank accoung.

The indictment further alleges that, working with Osman Al-Bari, Timothy Reed, Terrence White and others, Leonard served as the title agent for several straw purchasers who bought at least 20 properties in Maryland, Virginia and Washington, D.C. For example, the indictment alleges that co-conspirator Sabrina Weinberg purchased four properties for Al-Bari and others and was paid approximately $40,000 for the purchases. Weinberg and other straw purchasers used fraudulent loan applications and closing documents to qualify for the mortgages and to disguise the true buyer of the property. According to the indictment Leonard had Weinberg sign false affidavits claiming that each property was her primary residence. Further, the indictment alleges that Leonard kicked back a portion of the settlement funds from the straw buyer properties, disguising the wire transfers on the closing documents as reimbursement for alleged “renovations” performed on the properties prior to closing by Brotherly Investment Group, a company owned by Al-Bari, Reed and White. The indictment alleges that for the Weinberg properties alone, Leonard sent wire transfers totaling $515,820 to Al-Bari, Reed and White.

According to the indictment, almost all of the properties Leonard was involved with went into foreclosure, causing actual losses of over $7 million.

Leonard faces a maximum sentence of 30 years in prison for each of four counts of mail fraud and five counts of wire fraud.

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.

United States Attorney Rod J. Rosenstein thanked the U.S. Postal Inspection Service, the Federal Bureau of Investigation, the Montgomery County State’s Attorney’s Office – Economic Crimes Unit and the U.S. Secret Service for their investigative work and assistance. Mr. Rosenstein commended Assistant United States Attorney Kwame J. Manley, who is prosecuting the case.

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