Giuseppe Cracchiolo, 60 of Romeo, Mich., pleaded guilty before U.S. District Judge Paul D. Borman to “a federal information” that charges him with conspiracy to commit wire fraud.
Also charged in the one count information was Atim Collins, 38, of Detroit, and Ted Carter, 59, of Detroit, both of whom have already pleaded guilty to the same information, according to U.S. attorney Barbara McQuade.
McQuade said from 2002 through 2005, Collins, owner of Edgewood Property Management in Shelby Township, Mich., recruited and paid individuals to act as straw buyers in fraudulent mortgage loan transactions.
The scheme to defraud allegedly involved homes built by Cracchiolo, through his company, Mark Christian Inc. in Romeo. The straw buyers generally had good credit ratings, but not enough income, and lacked the qualifications necessary to purchase the properties.
Carter participated in the conspiracy by creating false documents, including fictitious W-2 forms and pay stubs, used by the straw buyers to support the fraudulently inflated asset and income information submitted on their mortgage loan applications.
After the loans were approved by the lending companies, prosecutors allege Cracchiolo used MCI to receive and disburse the illegally gained proceeds. This scheme to defraud resulted in the approval and disbursement of over $4.1 million in fraudulent mortgage loans.
Investigators say Cracchiolo admitted that during the conspiracy, he arranged to have the illegally obtained loan proceeds transferred back to borrowers and others without the knowledge and approval of the lending companies.
All of the properties involved in the fraud went into foreclosure resulting in approximately $2.5 million in losses to the lenders.
Conspiracy to commit wire fraud is punishable by a maximum sentence of 20 years’ imprisonment and $250,000 in fines.
Sentencing is scheduled for Carter on Oct. 6, Collins on Nov. 11 and Cracchiolo on Dec. 2.
