Archives For False Documents/HUD

Dean Rossi, 55, Warrington, Pennsylvania, was sentenced to five years in prison, four years of supervised release, and was ordered to pay $2.85 million in restitution and $1.38 million in forfeiture for devising and participating in schemes to defraud three financial institutions out of millions of dollars.

Rossi was convicted at trial in March 2018 on seven charges: one count of conspiracy to commit mail fraud affecting a financial institution and bank fraud; one count of mail fraud affecting a financial institution; three counts of bank fraud; and two counts of loan fraud.

From at least December 2006 until about March 2012, Rossi and his co-conspirators participated in schemes to defraud Nova Bank, First Cornerstone Bank, and Leesport Bank, which later became VIST Financial Bank, out of more than $4.15 million in connection with multiple real estate closings for small residential properties in working class neighborhoods in the Philadelphia, Pennsylvania area. In each scheme, the defendant conspired with others to obtain fraudulent mortgage loans and made misrepresentations regarding the disbursement of those funds and his income. The defendant also falsified numerous documents, including tax returns and HUD-1 settlement sheets. Although the banks were able to mitigate some of their fraud losses, the banks and their insurers still suffered losses exceeding $2.85 million. Rossi personally pocketed a total of $1.38 million.

United States Attorney William M. McSwain made the announcement.

The scope and duration of Rossi’s fraud are simply stunning,” said U.S. Attorney McSwain. “He stole millions of dollars from bank lenders and preyed upon residential neighborhoods – and then attempted to cover his tracks with lies. That sort of white collar crime deserves significant prison time, which is what Rossi has earned.”

“Dean Rossi lied on mortgage applications starting in 2006, his lies and greed helped to contribute to the financial meltdown in 2008,” observed Damon Wood, Inspector in Charge of the Philadelphia Division of the Postal Inspection Service.  “Over ten years later, after being found guilty at trial, he has finally been sentenced to five years in jail.  I want to thank the Postal Inspectors and the Assistant United States Attorneys who stayed with this case for nearly a decade.  The Postal Inspection Service has long history of investigating frauds schemes, and we will continue to lead and support investigations into fraud schemes that use the mail.

The case was investigated by the United States Postal Inspection Service and is being prosecuted by Assistant United States Attorneys Mark Dubnoff and Elizabeth Ray.

Wesley T. Bishop, 52, New Orleans, Louisiana was sentenced to four years of probation for making a false statement.

Bishop admitted to knowingly and willfully making a false, material statement to the United States Department of Housing and Urban Development (“HUD”) in connection with rental property that he owned.

As explained by FBI New Orleans Special Agent in Charge Bryan Vorndran, “Former State Senator Bishop made false statements on HUD paperwork which resulted in Bishop receiving a forgivable $188,000 loan under the “road home” program.”

Pursuant to the plea agreement, Bishop has agreed to pay restitution of $188,000 to the State of Louisiana, Division of Administration, Office of Community Development, which administers the subject Small Rental Property Program on behalf of HUD.  In addition to probation, Bishop has been ordered to pay a $100.00 special assessment fee.

U.S. Attorney Peter G. Strasser made the announcement.

U.S. Attorney Strasser praised the work and tireless efforts of the HUD Office of Inspector General and the FBI in investigating, and of Assistant United States Attorney Andre J. Lagarde in prosecuting this matter.

Jonathan Marmol, 41, Odessa, Florida has been sentenced to 15 months in federal prison and Mordechai Boaziz, 67, Miami Beach, Flordia, to 90 days in federal prison for conspiracy to make false statements to financial institutions.

According to court documents, beginning around the summer of 2006, and continuing through August 2008, Boaziz and Marmol conspired with others to execute a scheme to influence the credit decisions of financial institutions in connection with the sale of condominium units at The Preserve at Temple Terrace, a 392-unit condominium complex located in Temple Terrace, Florida. Boaziz was a real estate developer converting The Preserve from an apartment complex into a condominium complex. Boaziz, the leader and organizer of the fraud scheme, hired Marmol to market the condominium units at the complex.

In order to recruit and entice otherwise unqualified buyers to purchase units at The Preserve, the conspirators offered to pay the prospective buyers’ down payments (“cash-to-close”). The conspirators then intentionally concealed the cash-to-close payments from the financial institutions that originated and funded the related mortgage loans.

In particular, the HUD-1 Settlement Statements submitted to the financial institutions falsely stated that the buyers brought their own cash-to-close funds to purchase the units, which influenced the financial institutions’ mortgage loan approval decisions. In reality, Boaziz funded the buyers’ cash-to-close and routed the payments through Marmol and others. Boaziz caused approximately $5.36 million in losses, and Marmol caused approximately $330,000 in losses to the victim financial institutions who financed the units at The Preserve.

Marmol and Boaziz had pleaded guilty to the offenses in November 2019. http://www.mortgagefraudblog.com/?s=Jonathan+Marmol

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

 

Jared Castellaw, 34, Alpine, California, and Valerie Schones, 54, Tucson, Arizona, were sentenced on Wednesday, July 17, 2019 for their role in making false statements to a financial institution.

According to court documents, beginning in or around October 2008 and continuing to on or about May 2009, Castellaw and Schones, along with co-defendant Patrick Healey, made false statements to the Federal Housing Administration “FHA” in order to assist low-income borrowers in qualifying for FHA insured loans that they would not otherwise have qualified for. Healey and Castellaw are former employees of an undisclosed entity, ABC Homes, LLC, located in St. Bernard Parish, Louisiana.  Schones worked for XYZ Financial as a loan officer. In total, due to the acts of the defendants, the FHA suffered a loss in excess of $852,415.

Both Castellaw and Schones were sentenced to time served, supervised release of 5 years, a special assessment of $100, and ordered to pay restitution in the amount of $852,415.16.

U.S. Attorney Peter G. Strasser made the announcement.

U.S. Attorney Strasser praised the work of the Department of Housing and Urban Development, Office of Inspector General and the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Sharan E. Lieberman and Edward J. Rivera.

Eric Granitur, 60, Vero Beach, Florida, an attorney, George Heaton, 75, West Palm Beach, Florida, a property developer and Stephen McKenzie, 46, Melbourne, Florida, a condominium buyer were sentenced today to prison for participating in a criminal conspiracy and making false statements to a federally insured institution.

According to the court record, in 2009, Eric Granitur owned and operated Live Oak Title, which conducted two real estate closings for the purchase of five condominiums at the Vero Beach Hotel and Spa.  The seller and developer of the Vero Beach Hotel and Spa, George Heaton paid numerous incentives to buyer Stephen McKenzie to purchase the condominiums.  Heaton agreed to pay the “cash-to-close” amount that the buyer McKenzie was expected to bring to closing, and nearly $380,000 in additional cash after closing.

Granitur’s title company, Live Oak Title, conducted the closings for the sales of the Vero Beach Hotel and Spa condominium units sold to buyer McKenzie.  As an escrow agent, Granitur was required to truthfully and accurately prepare and distribute a settlement statement to the financial institutions, known as a “HUD-1,” in preliminary form for review by the financial institution, prior to the closing of escrow.   The closing statement was required to accurately reflect, among other information, the sales price, the closing funds provided by the borrower and all of the seller’s contributions.  As an escrow agent, Granitur was responsible for receiving and holding in trust, in an escrow account, the mortgage loan proceeds from the financial institutions that financed the purchase of the condominium units, and he was responsible for disbursing those loan proceeds only after final approval by the financial institutions.

On two occasions, involving Vero Beach Hotel and Club condo units sold by Heaton to McKenzie, Granitur knowingly caused a false closing statement to be transmitted to a federally insured financial institution.  The HUD-1 closing statements failed to truthfully disclose seller credits and incentives.  Additionally, the closing statements failed to disclose that the seller was paying the buyer’s “cash-to-close.”  The financial institutions relied upon the closing statement in authorizing the release of funds.

U.S. District Judge Robin L. Rosenberg sentenced Granitur, Heaton and McKenzie to prison today.

Granitur was sentenced to 12 months and one day in prison, to be followed by 5 years of supervised release.  He was ordered to forfeit approximately $28,000.

Heaton, who pleaded guilty and cooperated with the government, was sentenced to 6 months in prison, 3 years of supervised release, and forfeited approximately $263,000.

McKenzie, who pleaded guilty and cooperated with the government, was sentenced to 4 months in prison and 3 years of supervised release.

Benjamin G. Greenberg, United States Attorney for the Southern District of Florida; Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; and Edwin Bonano, Special Agent in Charge, Tampa, Florida, Federal Housing Finance Agency, Office of Inspector General (FHFA-OIG) made the announcement.

Mr. Greenberg commended the investigative efforts of the FBI and FHFA-OIG in this matter.  This case was prosecuted by Special Assistant U.S. Attorney Joseph A. Capone and Assistant U.S. Attorney Daniel E. Funk.

Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

 

Hector Hernandez, real estate developer and owner of a mortgage company, 57, Miami, Florida; Aleida Fontao, co-owner of a mortgage company, 62, Miami, Florida; and Olga Hernandez, senior mortgage underwriter, 58, Lake Mary, Florida, each pleaded guilty to conspiracy to commit wire fraud affecting a financial institution in connection with an FHA mortgage fraud scheme involving federally insured mortgages that caused losses of $64 million to the Federal Housing Administration (FHA).  Including these defendants, 25 individuals have pleaded guilty to offenses related to this scheme to date..  Hector and Olga Hernandez both pleaded guilty on July 13, 2015, while Fontao pleaded guilty on July 7, 2015.  As part of his plea, Hector Hernandez also agreed to forfeit $8 million, which amounts to his profits from the scheme.

Hector Hernandez’s mortgage company, Great Country Mortgage Bankers, specialized in mortgage loans that were insured by the FHA. Continue Reading…

Grady Wayne Fricks, 65, Nashville, Tennessee, pleaded guilty to conspiracy charges arising out of a scheme to defraud Cornerstone Community Bank, Dalton, Georgia, using false appraisals, settlement statements and misrepresentations to qualify for more than a million dollars in loans.

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Ania Nowak, 48, Belvidere, New Jersey, a former real estate title agent was sentenced to 66 months in prison for carrying out a mortgage fraud scheme in which she obtained seven loans, totaling more than $3.7 million, on two properties located in Wood-Ridge, New Jersey and Belvidere, New Jersey.

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Six individuals were indicted for participating in a mortgage fraud conspiracy involving alleged misrepresentations to the banks including fictitious verifications of false and fraudulent employment and bank deposit information set forth on loan applications.  Continue Reading…

Carole Tilghman, 50, Baltimore, Maryland, a title insurance agent who took tens of thousands of dollars from her clients’ escrow accounts to pay her personal bills pleaded guilty in the Circuit Court for Baltimore County to one count each of felony theft and felony theft scheme.

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