Two of 10 Indicted Plead Guilty to Mortgage Fraud

Two of 10 defendants indicted in a straw buying mortgage fraud scheme have pleaded guilty to their roles. Anthony E. Carollo of Raytown, Mo., and Rebecca Gelwix of Des Moines, Iowa, each admitted to conspiring with Eric M. Rabicoff and others to defraud mortgage lenders. According to Lanny Welch, U.S. attorney for the District of Kansas, the convicted and alleged conspirators arranged for straw buyers to purchase homes that were for sale by owners. They obtained financing for the deals by submitting false loan applications to lenders. The scheme also called for contract prices to be increased and for the convicted and alleged conspirators to receive money by submitting false invoices to title companies at closing. Carollo, the manager of a small business, was listed as the employer for all the straw buyers and provided false verifications of employment on behalf of the straw buyers that were sent to lenders. Defendant Anthony Painton, Jr., recruited Gelwix as a straw buyer. The scheme obtained more than $3 million. Carollo and Gelwix are scheduled for sentencing Nov. 16. Painton, who pleaded guilty in January, is scheduled for sentencing Oct. 19. The remaining seven defendants, including Mr. Rabicoff, are awaiting trial and were unavailable for comment. They are: Jason L. Rabicoff, Lucas R. Collier, Deborah Saulmon, Bora Ly, Kong Bun Ly and Richard Ngek.