Woman Pleads Guilty To Wire Fraud In Connection With Mortgage Fraud Scheme

Stephanie Abbott —  January 27, 2022 — Leave a comment

Tammy Jones, a/k/a “Tammy Taylor, 53, Upper Marlboro, Maryland, pleaded guilty yesterday to wire fraud in connection with a mortgage fraud scheme.

According to her guilty plea, in May 2011 Jones purchased a home in Brandywine, Maryland.  To finance the purchase of the home, Jones obtained a mortgage for $360,660 from Lender 1, which was backed by the Federal Housing Administration (FHA).

In 2017, Jones sought and received a loan modification for her FHA-insured mortgage through the U.S. Department of Housing and Urban Development (HUD) Partial Claim Program, which is a loan modification program for FHA-insured mortgages.  As part of the Partial Claim Program, HUD works to restructure the borrower’s mortgage payments using a partial claim which allows the borrower to stay in the home.  A lender files a “partial claim” with HUD for a portion of the outstanding mortgage balance and HUD makes payment to the lender on behalf of the borrower for that portion of the mortgage.  In exchange, HUD receives a security interest in the property in the amount of the balance that was paid to the lender and the borrower agrees to repay HUD for the amount of the partial claim.  Thus, the lender is effectively “made whole” by the partial claim payment from HUD.  When the borrower sells the home, the borrower is ultimately responsible for the balance of the partial claim to remove the lien held by HUD.

As stated in her plea agreement, in or around June 2017, Jones sought and received a loan modification through the HUD Partial Claim Program for her Brandywine, Maryland home.  HUD made a partial claim payment to Servicer 1 (who serviced Jones’s FHA-insured mortgage) of $111,377.12 on behalf of Jones.  In exchange, Jones granted HUD a security interest in the Brandywine, Maryland property for $111,377.12, the amount of the partial claim payment made by HUD.  Jones also entered into a loan modification agreement with the mortgage lender, in which Jones owed $352,151.01 in principal and agreed to make monthly payments of $2,564.96.

In 2018, Jones sought to sell the Brandywine, Maryland property for $429,900.  To close the sale of the property, employees of a settlement company sought proof that Jones’s lien from HUD and the FHA had been released.

In fact, the lien had not been released.  Jones thereafter created false and fraudulent documents to make it appear as though the lien had been released in order to facilitate the sale of the Brandywine, Maryland home as part of the scheme.

Specifically, Jones created a fraudulent email account, purporting to be an employee of a company contracted by HUD to service loans on HUD’s behalf.  Jones, posing as an employee of the HUD contractor, told an employee of the settlement company that the lien on the Brandywine, Maryland home had been released and Jones created and attached a bogus lien release document.  Jones thereafter continued to contact the settlement company while posing as an employee of the HUD contractor.  Jones also submitted a fraudulent Certificate of Satisfaction to the settlement company, which permitted the sale of the Brandywine, Maryland property on or about October 19, 2018.

After the sale of the Brandywine, Maryland property closed, the induvial who purchased the home from Jones was notified of the outstanding lien on the property in 2019.  Investigation revealed that Jones had falsified documents and fraudulently posed as an employee of the HUD contractor in order to further her scheme to defraud HUD.

In total, Jones caused a net loss of $111,377.12 to HUD, which represents the partial claim that HUD paid on behalf of Jones in September 2017.

As part of her plea agreement, Jones will be required to pay $111,377.12 in restitution.

Jones faces a maximum sentence of 20 years in prison followed by up to three years of supervised release for wire fraud.  U.S. District Judge Theodore D. Chuang has scheduled sentencing for May 20, 2022 at 2:30 p.m.

The guilty plea was announced by United States Attorney for the District of Maryland Erek L. Barron and Special Agent in Charge Bertrand Nelson of the U.S. Department of Housing and Urban Development Office of Inspector General.

United States Attorney Erek L. Barron commended HUD-OIG for their work in the investigation.  Mr. Barron thanked Assistant U.S. Attorney Caitlin R. Cottingham, who is prosecuting the case.

For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.

Stephanie Abbott

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