NOV 15, 2012

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Compliance Matters

California Attorney Faces Debarment for Lawsuit Scheme

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From August of 2001 through 2009, James Hoffman conspired to defraud mortgage lenders and obtain money from those lenders. Teresa Hoffman began participating in the scheme in August of 2006. The defendants allegedly recruited straw buyers to purchase real estate in both Minnesota and Wisconsin with the proceeds of fraudulent mortgage loans arranged by James Hoffman and in some instances by both defendants. The defendants owned several entities, which arranged financing for the fraudulent transactions.

From August 2001 through 2008, the couple lived in a Hastings home without ever owning it. James Hoffman arranged for a series of straw purchasers to buy the property entirely with the proceeds of fraudulent loans. From June 2001 through 2008, the couple used a Spicer Lake property as their vacation home without ever owning it by also arranging fraudulent mortgage loans for a series of straw buyers. Starting in June 2006, the couple, through three of their businesses, purchased apartment buildings in Rochester, Sauk Rapids, and Spicer. They converted the apartments into condominiums and sold them to straw buyers with a loss to mortgage lenders is approximately $5 million. During the course of the conspiracy, the defendants received loan proceeds that were wire transferred by the lenders.

Between 2005 through 2010, the Hoffmans spent money gained from the scheme to pay for luxury items such as lawn services, Caribbean cruises, country club fees, boat and boat trailers, swimming pool maintenance, luxury furniture, and private school tuition, rather than using those funds to pay the taxes owed to the IRS. (loansafe.org11212)

MORAL

Did you notice that the loans went back 11 years? So the federal prosecutors do chase loans funded 11 years ago.

LAS VEGAS MORTGAGE AGENT FOUND GUILTY OF FRAUD

FACTS

On Nov. 9, Heidi Haischer, a Las Vegas mortgage agent, was found guilty for participation in a mortgage fraud scheme that netted $1.2 million in fraudulent mortgage loans.

After a four-day trial before U.S. District Judge Miranda Du in the District of Nevada, a federal jury convicted Haischer of one count of wire fraud and one count of conspiracy to commit wire fraud for submitting fraudulent loan documents to purchase two homes.

Haischer submitted to lending institutions loan applications in which she misrepresented her income, submitted false verification of employment and misrepresented her intent to reside in one of the properties as her primary residence. Evidence at trial established that Haischer participated in an illegal property flipping ring that fraudulently obtained properties that Haischer and her co-conspirators intended to sell for a profit. Haischer and her co-conspirators also enriched themselves by collecting brokerage commissions generated by the sales of the properties.

Co-conspirator Kelly Nunes was convicted in a related case in Las Vegas on Feb. 2 of one count of bank fraud and one count of conspiracy to commit wire and bank fraud.  (usattynv11912)

MORAL

The federal prosecutors are still out there investigating loans from 2005 to the present. Here is one person that will lose her MLD license if not already lost.

NEW JERSEY WOMAN GETS 37 MONTHS FOR PHONY MORTGAGES

FACTS

On Nov. 9, Crystal Paling was sentenced to 37 months in prison for her role in a wire fraud and money-laundering scheme involving phony mortgages issued for properties in New Jersey and Florida. This was following a three-week trial. 

Paling was convicted of both counts charged in the indictment against her: conspiracy to commit wire fraud and conspiracy to commit money laundering.

Paling acted as the closing agent for fraudulent mortgage loans orchestrated by her co-conspirators, Daniel Verdia, Jaye Miler and Sandra Mainardi. The co-conspirators put together buyers and sellers in real estate transactions that they could control and then filed false and fraudulent loan applications containing inflated income figures for the borrowers.

Paling wired loan proceeds due to the sellers from a trust account that she controlled to an account in the name of Capital Investment Strategies, a shell company owned by Verdia and Miller. She concealed illicit payments to Capital Investment Strategies by failing to disclose them on the settlement statements. She collected a portion of the disclosed closing fees that appeared on the settlement statements. She also received undisclosed kickbacks paid from Capital Investment Strategies to her own shell company, XL Partnership. Paling retained some mortgage loan proceeds in the trust account and used them to pay back the mortgages on certain properties in order to keep the loans in good standing until the lender’s buyback period expired.

In addition to the prison term, Judge Sheridan sentenced Paling to three years of supervised release and ordered her to pay $532,497 in restitution.

Five others charged in the scheme have pled guilty: Verdia and Miller each pleaded guilty to one count of conspiring to commit wire fraud and money laundering and were sentenced to 30 months and six months, respectively; Donald Apolito pleaded guilty to tax evasion and was sentenced to five years of probation; Robert Gorman, pleaded guilty to subscribing to false tax returns and was sentenced to two years of probation and Mainardi pleaded guilty in Florida federal court to one count of wire fraud and was sentenced to 46 months in prison.  (usattynj11912)

MORAL

Read the sentences and you pick out the ones that had the best lawyers.

BUILDER GUILTY OF MORTGAGE FRAUD IN TEXAS

FACTS

 

On Nov. 8, Larry Reisman pleaded guilty to federal charges in the Eastern District of Texas to making a false statement in connection with an FHA-insured home loan.  He is the 20th conviction in this scheme.

Reisman, who operated Springfield Custom Homes, was involved in a widespread mortgage fraud scheme involving homebuyers, recruiters, homebuilders, mortgage brokers, loan officers, and a title company employee. Reisman admitted that in order to enable homebuyers to purchase a home from him, he secretly supplied the down payment funds to the homebuyer so the homebuyer could qualify for an FHA-insured mortgage loan and that he falsely represented to FHA that he did not supply any of the down payment funds. Reisman’s scheme resulted in losses to mortgage lenders, including Fannie Mae and Freddie Mac.

Reisman faces up to five years in federal prison at sentencing and restitution of $1.5 million. A sentencing date has not been set.  (usattyedtx11812)

MORAL

Remember how I have been saying the federal prosecutors are still chasing the fraudulent loans?  Remember how I have been saying the lenders such as Chase, Flagstar, FDIC and Mortgage Law Recover Group and Celotti Law Firm have been chasing brokers, loan officers and lenders to pay for losses on loans that went into foreclosure and sale?  Now we have those trying to resolve the matters on their own and appear to be faring worse than the results we have been getting. The main problem? They usually come to us after they try to settle on their own and give up potential available defenses in the process.

 

THE INFORMATION CONTAINED HEREIN IS NOT LEGAL ADVICE.

AN ATTORNEY SHOULD BE CONSULTED IF YOU DESIRE LEGAL ADVICE.

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