Bernadette Nicholas was a mortgage broker who intentionally misrepresented material facts to Wilmington Trust about borrowers’ income and assets, the potential rental income, and accurate appraisals of properties. She falsified borrowers’ tax returns and documents relating to the true source and amount of the down payments being made by borrowers and forged borrowers’ signatures on loan documents.
Kevin McAllister was a loan officer with Wilmington Trust working in conjunction with Nicholas to approve mortgage loans for borrowers who did not meet Wilmington Trust’s criteria for income, assets, and credit scores, in return for bribes and kickbacks from Nicholas. As a result, Nicholas and McAllister caused the approval of loans totaling more than $30 million.
Bernadette Nicholas received a mortgage broker’s commission equivalent to approximately two to three percent of the total amount of a funded loan at the time of loan settlement. During the years 2004, 2005, and 2006, Bernadette Nicholas received approximately $1.2 million as the result of the loans funded by Wilmington Trust. She deposited the money into accounts maintained by Dennis Nicholas who then paid Kevin McAllister equivalent to approximately one percent of the amount of the funded loan, which was a kickback/bribe for getting the questionable loan approved and funded. McAllister made $379,075 in kickbacks. None of the defendants reported the income on their taxes.
Another defendant, Wayne Rosen, who was charged in a scheme with Bernadette Nicholas to defraud Malvern Federal, was scheduled to be sentenced on Feb 25. Nicholas brokered the sale of an apartment building between Rosen and mortgage clients and sought a $1.6 million loan from Malvern Federal for her clients.
Nicholas altered the borrowers’ income tax returns prior to submitting them to Malvern Federal and falsely represented the borrowers’ income, the amount of the borrowers’ down payment, and the details of a subordination agreement between Rosen and the borrowers on the borrowers’ loan application and supporting documents. At settlement on the apartment building, Dennis Nicholas, Bernadette Nicholas, and Rosen falsely represented to Malvern Federal that the borrower had made a down payment. Bernadette Nicholas and Rosen applied for a $3.5 million loan to refinance an existing loan that they had on a medical building.
In order to influence Malvern Federal’s actions, Bernadette Nicholas, Dennis Nicholas, and Rosen prepared and caused to be prepared fraudulent leases which misrepresented the potential rental flow income of their medical building and caused these leases to be submitted to Malvern Federal. (usattyedpa21313)
Notice how long the sentences are getting. Notice too, that the federal prosecutors went back to 2004 (nine year old loans) to get to them. The prosecutors are doing this nationwide and have been for some time. They 10 ten years from when a loan closed to file criminal charges against the people involved, usually brokers and loan officers as here.
THE INFORMATION CONTAINED HEREIN IS NOT LEGAL ADVICE. AN ATTORNEY SHOULD BE CONSULTED IF YOU DESIRE LEGAL ADVICE.