Top Executives Plead Guilty to $8.9 Million in Warehouse Loan Fraud

Stephanie Abbott —  March 15, 2018 — Leave a comment

Edward J. Sypher, Jr., 41, Scarsdale, New York and Matthew T. Voss, 42, Northport, New York, senior executives at Long Island, New York mortgage lender Vanguard Funding, LLC (Vanguard), pleaded guilty today to conspiring to commit wire and bank fraud in connection with their diversion of more than $8.9 million of warehouse loans that Vanguard had obtained to fund mortgages.

According to court filings and the facts presented at the plea proceedings, between August 2016 and March 2017, Voss, Vanguard’s Chief Operating Officer, and Sypher, the Chief Financial Officer, engaged in a scheme in which they obtained warehouse loans, or short-term loans, for Vanguard by falsely representing that Vanguard would use the proceeds of those loans to fund mortgages or mortgage refinancing for Vanguard’s clients.  Once Vanguard received the loans, however, the defendants diverted the monies to pay personal expenses and compensation, and to pay off loans they had previously obtained with fraudulent loan submissions for improper purposes.

The guilty pleas were entered before United States District Judge Sandra J. Feuerstein.  When sentenced, each defendant faces up to 20 years in prison, as well as restitution, criminal forfeiture and a fine.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office, and Maria T. Vullo, Superintendent, New York State Department of Financial Services, announced the guilty pleas.

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Whitman G.S. Knapp and Elizabeth Losey Macchiaverna are in charge of the prosecution.

Stephanie Abbott

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