Archives For Stephanie Abbott

Adolfo Schoneke, 45, Torrance, California, who along with his sister and other co-conspirators participated in a $6 million real estate scam that listed homes for sale without owners’ consent and collected money from multiple would-be buyers, was sentenced today.

Schoneke and his sister, along with co-conspirators, operated real estate and escrow companies based in Cerritos, La Palma and Long Beach, California under a variety of names, including MCR and West Coast Realty Services. Schoneke and the other members of the conspiracy located properties to list for sale – even though they did not intend to sell the properties to anyone, and in many instances the properties were not for sale at all.

The properties were listed on real estate websites such as the Multiple Listing Service (MLS) and were marketed as short sale opportunities. In some cases, the homes were marketed through open houses arranged by tricking homeowners or occupants into allowing their homes to be used.

Multiple offers were accepted for each of the not-for-sale properties, but the co-conspirators hid this fact from the victims and instead led victims to believe their offer was the only one accepted. The co-conspirators strung victims along – sometimes for years – by telling them closings were being delayed because lenders needed to approve the purported short sales.

Office workers opened bank accounts to hide the co-conspirators’ involvement in the fraud. Those accounts were used to receive down payments on the homes and other payments from victims who were convinced to transfer the full “purchase price” after receiving forged short sale approval letters. The co-conspirators directed the office workers to withdraw large amounts of cash from these accounts, which made the proceeds harder to trace.

Schoneke “and his co-conspirators used numerous properties to further the fraudulent scheme, and collected more than $11.7 million from victims as part of the scheme (involving more than 860 transfers from approximately 750 or more victims),” according to the sentencing memo. “Although some of the victims were paid back, the scheme caused more than $6 million in losses to nearly 400 victims.

The fraud scheme [Schoneke] invented, proposed to his co-conspirators, and carried out involved uniquely devious means designed to steal money from as many victims as possible,” according to a sentencing memorandum filed by prosecutors. “Playing on the dream of home ownership and seemingly out of reach home prices, [Schoneke] figured out a way to ‘sell’ homes that he did not own and had no business in listing for sale.

Schoneke, who pleaded guilty in May, 2022, to one count of conspiracy to commit wire fraud, was sentenced by United States District Judge R. Gary Klausner. A restitution hearing was scheduled for December 12, 2022.

Schoneke’s sister, Bianca Gonzalez, 39, pleaded guilty in April,2022, admitting her role in the wire fraud scheme, and is scheduled to be sentenced on May 22, 2023.

In a related case, Mario Gonzalez (no relation to Bianca Gonzalez), 51, Garden Grove, California pleaded guilty in 2019 to conspiracy to commit wire fraud and is scheduled to be sentenced on April 3, 2023.

The FBI and the Federal Deposit Insurance Corporation, Office of Inspector General investigated this matter. The investigation was initiated by numerous complaints to the Long Beach Police Department and the Los Angeles County Sheriff’s Department, both of which provided substantial assistance during the federal investigation.

Assistant United States Attorney Kerry L. Quinn of the Major Frauds Section is prosecuting this case.

George Kritopoulos, 50, Salem, Massachusetts, a real estate developer was sentenced to four years in prison today in connection with a decade-long mortgage fraud scheme involving at least two dozen loan transactions, totaling $6.5 million that resulted in more than $3.8 million in losses to lenders.

Kritopoulos was originally charged in September 2018 along with co-defendants Joseph Bates III and David Plunkett.

From 2006 through 2015, Kritopoulos, Bates and others engaged in a scheme to defraud banks and other financial institutions by causing false information to be submitted to those institutions on behalf of borrowers – people recruited to purchase properties – located primarily in Salem. The properties were usually multi-family buildings with two-to-four units, which the conspirators then converted into condominiums. Kritopoulos recruited new borrowers to purchase the individual condominium units, which were also financed by mortgage loans obtained by fraud.

The false information submitted to lenders included, among other things, representations concerning the borrowers’ employment, income, assets and intent to occupy the property. Specifically, the false employment information included representations that borrowers were employed by entities that were, in fact, shell companies “owned” by Kritopoulos and were used to advance the fraudulent scheme. The employment information also included false representations about the income that the borrowers received from the entities, when, in fact, the borrowers received little or no income from them. Kritopoulos brought newly recruited borrowers to Plunkett, who then prepared tax returns that contained false and inflated income. Some of those tax returns were submitted to lenders in support of the fraudulent loan applications.

Since the borrowers did not have the financial ability to repay the loans, in all but two instances among 21 properties, they defaulted on their loan payments, resulting in foreclosures and losses to the lenders.

In addition, Kritopoulos sought to obstruct the federal criminal investigation into the mortgage fraud scheme by encouraging Bates and Plunkett to make false statements and create false documents he hoped would make the companies appear to have been legitimate.

Kritopoulos was sentenced by U.S. District Court Judge Patti B. Saris to four years in prison to be followed by two years of supervised release. The judge reserved determination on an order of restitution. On May 27, 2022, Kritopoulos was convicted by a federal jury of one count of conspiracy, two counts of wire fraud, six counts of bank fraud, one count of aiding the preparation of a false income tax return and one count of obstruction of justice.

Bates pleaded guilty to one count of conspiracy, three counts of wire fraud affecting a financial institution and two counts of bank fraud in October 2018 and is scheduled to be sentenced on December 1, 2022. Plunkett pleaded guilty to one count of bank fraud and one count of aiding in the submission of false tax returns in February 2019 and is scheduled to be sentenced on December 14, 2022

United States Attorney Rachael S. Rollins; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service – Criminal Investigation Division, Boston Office; and Christina Scaringi, Special Agent in Charge of the U.S. Department of Housing and Urban Development, Office of Inspector General, Northeastern Regional Office made the announcement today. Valuable assistance was provided by the Salem Police Department. Assistant U.S. Attorneys Victor A. Wild, of Rollins’ Securities, Financial & Cyber Fraud Unit, and Brian M. LaMacchia, of Rollins’ Affirmative Civil Enforcement Unit prosecuted the case.

Michael P. Flavin, 39, Quincy, Massachusetts, real estate broker was sentenced in federal court in Boston today for operating a scheme in which he falsely marketed properties that were not for sale, or had already been sold, and then stole the buyers’ real estate deposits.

Between 2017 and April 2020, Flavin solicited deposits on real estate transactions by marketing numerous real estate properties that were not actually for sale. In each case, Flavin executed purchase and sale agreements and received deposit checks from or on behalf of the potential buyers, even though the actual owners of the properties had not agreed to sell their properties or to sell them to those buyers. Flavin forged the signatures of the sellers on the purported purchase and sale agreements. Over this period of approximately three years, Flavin cashed more than 60 deposit checks totaling approximately $1.8 million.

Flavin was sentenced by U.S. District Court Judge Allison D. Burroughs to 30 months in prison and three years of supervised release. The Court reserved imposing a restitution order until a later date. On Dec. 17, 2021, Flavin pleaded guilty to two counts of wire fraud and two counts of aggravated identity theft.

United States Attorney Rachael S. Rollins and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement today. Assistant U.S. Attorney Victor A. Wild of Rollins’ Securities, Financial & Cyber Fraud Unit prosecuted the case.

James John Melis, 52, Largo, Florida has been indicted on four counts of wire fraud, two counts of bank fraud, and three counts of aggravated identity theft.

The indictment charges Melis with carrying out a mortgage origination fraud scheme against a financial institution for two properties he owned. To deceive the mortgage lender into believing he was a qualified borrower, Melis used the personal identification information of another person on loan applications, and prepared and submitted false and fraudulent IRS income tax returns, fictitious satisfactions of mortgages falsely representing that his properties had equity, and lease agreements falsely showing he received substantial rental income. As part of this scheme, Melis used the means of identification of other individuals and forged their signatures on the fictitious satisfactions of mortgage and phony lease agreements submitted to the mortgage lender. Based on Melis’ misrepresentations, the financial institution approved and funded both mortgage loans.

Separately, Melis abused his position as business manager at a private school in Tampa by attaching his personal bank account to the school’s PayPal account without authorization. When parents made tuition payments to the school’s account, Melis initiated fraudulent electronic funds transfers to his personal account. He then spent the stolen funds on travel and luxury items, such as jewelry.

If convicted, Melis faces a maximum penalty of 20 years in federal prison for each wire fraud count, 30 years for each bank fraud count, and a consecutive mandatory penalty of 2 years’ imprisonment for the aggravated identity theft counts.  The indictment also notifies Melis that the United States is seeking an order of forfeiture in the amount of $1.1 million, the proceeds of the charged criminal conduct.

An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.

United States Attorney Roger B. Handberg made the announcement

This case was investigated by the Federal Housing Finance Agency – Office of Inspector General and the Federal Bureau of Investigation.  It will be prosecuted by Special Assistant United States Attorney Chris Poor.

 

Edward E. Bohm, 44, Smithtown, New York, formerly the President of Sales and part-owner of mortgage lender Vanguard Funding, LLC (Vanguard), based in Garden City, New York was sentenced today to 24 months’ imprisonment in connection with the diversion of more than $8.9 million of warehouse loans that Vanguard had fraudulently obtained purportedly to fund home mortgages and mortgage refinancing.

Between August 2015 and March 2017, Bohm and his co-conspirators at Vanguard engaged in a scheme in which they obtained more than $8.9 million in short-term loans, referred to as warehouse loans, by falsely representing that the loan proceeds would fund specific mortgages, or refinance specific mortgages, for Vanguard clients.  Instead, Bohm and his co-conspirators diverted the funds to pay personal expenses and compensation, and to pay off loans they had previously obtained through false loan applications.

Bohm is the third defendant to be sentenced in connection with this scheme.  On February 6, 2019, Vanguard Senior Vice President and Chief Financial Officer Edward J. Sypher, Jr., was sentenced to 18 months’ imprisonment and restitution in the amount of $3,488,615.42 following his conviction on conspiracy to commit wire and bank fraud charges.  On February 26, 2019, Vanguard Chief Operating Officer Matthew T. Voss was sentenced to 24 months’ imprisonment and $3,488,615.42 restitution following his conviction on conspiracy to commit wire and bank fraud charges.

Bohm was also ordered to pay $3,488,615.42 in restitution and $1,500,000 in criminal forfeiture.  In February 2019, Bohm pleaded guilty to conspiring to commit wire and bank fraud.

Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Adrienne A. Harris, Superintendent, New York State Department of Financial Services (DFS), announced the sentence.

With today’s sentence, Edward Bohm has been deservedly punished for his role in a fraudulent scheme that deceived banks that trusted and relied upon him as a business partner.  Bohm diverted the loan proceeds to, among other things, pay tens of thousands of dollars in monthly personal credit card expenses and finance the luxury house in which he lived,” stated United States Attorney Peace.  “This Office, together with our law enforcement partners, will vigorously investigate and prosecute those who commit fraud to advance their own financial interests at the expense of businesses and residents of our district.

Edward Bohm and his associates at Vanguard Funding defrauded the financial institutions that provide critical residential mortgage funding, helping themselves to the short-term loans they falsely claimed were on behalf of consumers,” stated DFS Superintendent Harris.  “As New York’s financial services regulator, I am proud of DFS’s mortgage banking examiners and criminal investigators who assisted in the investigation that brought Bohm to justice, and who will continue to root out fraud on behalf of all New Yorkers.

The government’s case is being prosecuted by Assistant United States Attorney Whitman G.S. Knapp, with assistance from Special Agent Martin Sullivan of the Office’s Business and Securities Fraud Section.  Assistant United States Attorney Madeline O’Connor of the Office’s Asset Recovery Section is handling forfeiture matters.

Barry Wayne Plunkett Jr., 62, and Nancy Plunkett, 57, both of Hyannis Port, Massachusetts a former Massachusetts attorney and his wife have been sentenced in federal court in Boston in connection with various mortgage fraud schemes.

The defendants engaged in several bank fraud schemes. In one scheme, from September 2012 to July 2016, the defendants defrauded six mortgage lenders and 14 homeowners for whom the Plunkett Law Firm handled the closings for new mortgage loans to refinance residential properties. The Plunketts informed the mortgage lenders that pre-existing mortgages were paid off from the new loan proceeds when, in fact, they intentionally failed to pay off the prior liens and instead converted more than $1 million in payoff funds for their own purposes.

In other bank fraud schemes, between April 2015 and March 2018, the Plunketts fraudulently used various names, entities and false documents to obtain three successive mortgage loans on their home in Hyannis Port, Massachusetts in amounts of $412,000, $470,000 and $1.2 million. The defendants pledged as collateral a property in Hyannis Port that was held in a family trust for which Barry Plunkett was one of three beneficiaries. Both defendants participated in providing false documents to the lenders, including false title reports and other records to falsely represent that the property was free and clear of existing mortgage liens and forged documents in the names of other people. The defendants also made misrepresentations to a lender that Nancy Plunkett was a single woman living in Wellesley who was purchasing the property in her maiden name as a business investment when, in fact, the defendants had been married since 2014 and the property was their residence.

Barry Plunkett was sentenced to 78 months in prison and five years of supervised release. He was also ordered to pay restitution of $3,236,466 and forfeiture of $3,221,403. Nancy Plunkett was sentenced to one year and one day in prison and five years of supervised release. She was also ordered to pay restitution of $3,054,759, jointly and severally with Barry Plunkett, and forfeiture of $3,221,403. On March 4, 2022, Barry Plunkett pleaded guilty to five counts of bank fraud, one count of aggravated identity theft and one count of tax evasion. On the same date, Nancy Plunkett pleaded guilty to five counts of bank fraud.

Prior to being disbarred in October 2017, Barry Plunkett owned and operated the Plunkett Law Firm where his wife, Nancy Plunkett, served as his office assistant and paralegal.

United States Attorney Rachael S. Rollins; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Robert Manchak, Special Agent in Charge, Federal Housing Finance Agency, Office of Inspector General, Northeast Region made the announcement today. Assistant U.S. Attorneys Victor A. Wild and Mackenzie Queenin of Rollins’ Securities, Financial & Cyber Fraud Unit and Carol Head, Chief of Rollins’ Asset Recovery Unit, prosecuted the case.

 

 

German Antonio Lopez-Velasquez, 55,  Modesto, California; Marko Antonio Lopez, 27, Modesto, California and Lisa Marie Santos, 48, Long Beach, California have been charged with bank fraud and conspiracy to commit bank fraud.

According to court documents, Lopez-Velasquez and Lopez, who were both real estate agents, worked with Santos, a mortgage loan officer, to obtain fraudulent mortgage loans for properties based in Stanislaus County, San Joaquin County, Santa Clara County, California and elsewhere. The three utilized false documents, fictional companies, and fictional individuals to obtain mortgage loans for borrowers who were not qualified to receive loans. In total, the defendants caused lenders to issue at least 30 loans based on false information with a total principal loan balance exceeding $10 million.

Lopez-Velasquez was also charged with witness tampering. He is alleged to have attempted to persuade an individual to make false statements to law enforcement officers regarding a mortgage loan under investigation.

U.S. Attorney Phillip A. Talbert announced made the announcement.

This case is the product of an investigation by the Federal Housing Finance Agency – Office of Inspector General (FHFA-OIG), the U.S. Department of Housing and Urban Development – Office of Inspector General (HUD-OIG), and the U.S. Postal Inspection Service (USPIS). Assistant U.S. Attorney Jeffrey A. Spivak is prosecuting the case.

The FHFA-OIG is committed to holding accountable those who waste, steal, or abuse the resources of the Government-Sponsored Enterprises regulated by FHFA, which the defendants have been charged with defrauding,” said Jay Johnson, Special Agent in Charge, FHFA-OIG, Western Regional Office. “We are proud to have worked with the U.S. Attorney’s Office and our law enforcement partners on this case and to demonstrate, once again, that FHFA-OIG will investigate and hold accountable those who seek to victimize the Government-Sponsored Enterprises supervised and regulated by FHFA.”

This case demonstrates HUD OIG’s commitment to pursuing and bringing to justice those who put Federal programs, such as the FHA Mortgage Insurance Fund at risk for their own enrichment,” said Special Agent in Charge Mark T. Kaminsky with HUD OIG Office of Investigation. “HUD OIG remains committed to working with our law enforcement partners and the US Attorney’s Office, Eastern District of California to investigate and hold accountable those who perpetrate mortgage fraud in central California.”

If convicted, the defendants face a maximum statutory penalty of 30 years in prison and a $1 million fine for bank fraud and conspiracy to commit bank fraud. If convicted, Lopez‑Velasquez faces a maximum statutory penalty of 20 years in prison and a $250,000 fine for witness tampering. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

Theodore Kurz, 72, New Orleans, Louisiana, was sentenced on August 4, 2022 for mortgage fraud.

According to court documents, Kurz obtained mortgages for three properties through the State of Louisiana, Division of Administration, Office of Community Development.  He then forged mortgage cancellations that he filed with the Orleans Parish Clerk of Court to falsely make it appear that the loans had been satisfied.  Kurz then obtained mortgages through a different lender, falsely claiming that there were no outstanding mortgages or liens on the properties.

Kurz was sentenced to time served, 5 years of supervised release, $751,900 in restitution, and a mandatory $100 special assessment fee.

The Announcement was made by U.S. Attorney Duane A. Evans.

U.S. Attorney Evans praised the work of the Office of Inspector General for the U.S. Department of Housing and Urban Development and the Federal Bureau of Investigation for investigating this matter.  The prosecution of this case was handled by Assistant U. S. Attorney G. Dall Kammer, Chief of General Crimes Unit.

Maria Del Carmen Montes, 46, Kissimmee, Florida has been charged with one count of conspiracy to commit bank fraud, four counts of bank fraud and one count of aggravated identity theft. Also charged is Montes’ husband Carlos Ferrer, 45, Kissimmee, Florida with one count of conspiracy to commit bank fraud and three counts of bank fraud.

According to the Indictment, Montes and Ferrer conspired to create and executed a mortgage fraud scheme targeting financial institutions. To ensure that otherwise unqualified borrowers she was representing as a licensed realtor were approved for mortgage loans, Montes created fictitious and fraudulent paystubs and IRS Form W-2s in the names of companies for whom her clients had never worked. The bogus income documents falsely indicated that her clients had worked at these companies, including companies formed and controlled by Ferrer, for a certain period of time and earned income that they did not. Montes submitted the fictitious paystubs and W-2s she created to the financial institutions who relied on them when making underwriting decisions. Additionally, Montes used her clients’ personally identifying information on these documents without their knowledge or authorization.

In order to further deceive the mortgage lenders, Montes and Ferrer recruited a co-conspirator working at a company listed on certain false paystubs and W-2s to falsely certify Verifications of Employment (VOEs”) sent by the financial institutions and instructed the co-conspirator to lie to the final institutions when they called to further verify the borrower’s employment. Ferrer and Montes sent the false and fictitious paystubs and W-2s to the co-conspirator so the co-conspirator could put the false information on the VOEs before certifying, signing, and returning them to the financial institutions. Ferrer also falsely certified and emailed VOEs sent by the financial institution in the names of borrowers that he knew did not work for his companies and lied to the banks during verbal VOE checks. Based on Montes’ and Ferrer’s misrepresentations, the financial institutions approved and funded the mortgage loans.

If convicted, Montes faces a maximum penalty of 30 years in federal prison on the conspiracy count, up to 30 years for each fraud count, and a mandatory penalty of 2 years’ imprisonment for the aggravated identity theft count. If convicted, Ferrer faces a maximum penalty of 30 years in prison for the conspiracy count, and up to, 30 years’ imprisonment for each fraud count.

An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.

This case was investigated by the Federal Housing Finance Agency – Office of Inspector General, the U.S. Department of Housing and Urban Development – Office of Inspector General, and the Federal Bureau of Investigation.  It will be prosecuted by Special Assistant United States Attorney Chris Poor.

 

Heather Ann Campos, 43, Houston, Texas, David Lewis Best Jr., 56, Spring, Texas and Stephen Laverne Crabtree, 62, Herriman, Utah, have been taken into custody on charges related to a multi-layered mortgage fraud, credit repair and government loan fraud scheme. The tri had evaded law enforcement for several months.

All three allegedly sent numerous sovereign citizen letters to federal agencies and the federal court in Houston declaring themselves immune from prosecution and refusing to recognize the authority of the federal courts.

The charges allege Campos and Best recruited clients for credit repair using company names of KMD Credit, KMD Capital and Jeff Funding, among others. They allegedly “cleaned” their clients’ credit histories by filing false identity theft reports with the FTC. After fraudulently inflating client credit worthiness, the co-conspirators fraudulently obtained credit cards, disaster loans and mortgages for themselves and their clients, according to the charges. They were allegedly able to accomplish this through false statements and fake documents.

Campos was a mortgage broker and Buckley a realtor, while operating as a notary was the responsibility of Munoz, according to the charges. After fraudulently inflating client credit worthiness, the individuals allegedly obtained rental properties to deceptively build a real estate portfolio worth millions of dollars in their clients’ names and profit from rental income. The charges allege Crabtree was a credit repair client and recruited others, including his family members, and conspired to commit wire fraud.

In addition, they allegedly obtained loans from banks and the SBA’s Economic Injury Disaster Loan Program and Paycheck Protection Program. They were created in the names of clients, friends and family members through false statements and fake or altered documents.

Using the alias Jeff, Morizono was the leader and namesake for the scheme purporting to do business as Jeff Funding, according to the charges.

Campos and Best were indicted in January on numerous charges for participating in a conspiracy to defraud mortgage lending businesses, banks, Small Business Administration (SBA) and the Federal Trade Commission (FTC). They indicated they would self-surrender but allegedly fled from law enforcement. Since that date, several other co-conspirators were indicted, including Crabtree. He was released on bond and also became a fugitive.

Others indicted include Steven Tetsuya Morizono, 59, Mission Viejo, California; Albert Lugene Lim, 53, Laguna Niguel, California; Melinda Moreno Munoz, 41, Elvina Buckley, 68, Leslie Edrington, 65, and ShyAnne Edrington, 29, all of Houston, Texas.

Campos is set for a detention hearing before U.S. Judge Dena H. Palermo today at 10 a.m. Best and  Crabtree remain in custody pending further criminal proceedings.

U.S. Attorney Jennifer B Lowery made the announcement.

If convicted, they all face up to 30 years in federal prison and a possible $1 million maximum fine.

The Federal Housing Finance Agency – Office of Inspector General (OIG), U.S. Postal Inspection Service and SBA – OIG conducted the investigation with the assistance of the FTC – OIG and IRS – Criminal Investigation.

Other agencies assisted with the arrests of Campos, Best and Crabtree, to include The Unified Police Department of Greater Salt Lake; police departments in South Jordan, Riverton, and Herriman, Utah; FBI Hostage Rescue Team; U.S. Postal Inspection Service – Pittsburgh and Salt Lake City Divisions; and the U.S. Marshals Violent Fugitive Apprehension Strike Force.

Assistant U.S. Attorneys Kate Suh and Jay Hileman are prosecuting the case.

An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.