Fraud and Prevention

Three Florida Residents Charged in Real Estate Scheme

By James Comtois
September 2, 2009

Three Florida residents have been charged with conducting a real estate fraud scheme to sell vacant land in Miami-Dade County. Daniel Stephen of Miami Shores, Fla., Clotilde Jean of Miramar, Fla., and Patricia DePons also of Miami Shores, were charged with conspiracy to commit mail fraud and mail fraud for their participation in an alleged scheme that defrauded more than 1,000 victims of approximately $10.6 million.

According to Jeffrey H. Sloman, acting U.S. attorney for the Southern District of Florida, this case arose from the sale of property in North Florida and Georgia by First Loan Solution, a company owned and operated by Mr. Stephen and Ms. Jean. Mr. Stephen, Ms. Jean and other First Loan Solution employees allegedly sold land to members of the Haitian community in Miami-Dade County using advertisements on Haitian radio, leaflets in the community, bus trips to North Florida and direct solicitations of the buyers.

The indictment alleges that Mr. Stephen, Ms. Jean and other First Loan Solution employees made material misrepresentations to induce the buyers to purchase the vacant land. For example, Mr. Stephen, Ms. Jean and their employees allegedly represented to potential buyers that First Loan Solution and Mr. Stephen actually owned the land that was being sold to them, when neither First Solution nor Mr. Stephen owned the land.

Mr. Stephen also allegedly represented that First Loan Solution would maintain the buyers' deposit money in escrow prior to closing on the transactions but used that money for business and personal expenses. Mr. Stephen and Ms. Jean allegedly further represented that the buyers were purchasing individual parcels of land on which the buyers could build.

The buyers, however, were purchasing land collectively with other buyers through a limited liability company and couldn't build individually on the property.

According to the indictment, Mr. Stephen allegedly hired a title company to serve as closing agent. Ms. DePons was allegedly responsible for running the day-to-day affairs of the title company. Ms. DePons allegedly conducted the closings on the sales, and collected from the buyers the balance due on the sale and the title company's closing fees.

At the closings, Ms. DePons is alleged to have issued fraudulent warranty deeds and closing statements to the buyers in an effort to make the closings appear legitimate.

Ultimately, the buyers allegedly never received title to the land nor, in most cases, refunds of the monies paid to Mr. Stephen, Ms. Jean and Ms. DePons for the land. The defendants could not be reached for comment at press time.