Four south florida residents indicted for mortgage fraud

April 07, 2010

Four individuals were indicted in federal court on mortgage fraud and identity theft charges for concocting a scheme to defraud JP Morgan Chase Bank out of hundreds of thousands of dollars. One of those charged is still at large. The other three defendants made their initial appearance in the Southern District of Florida. The defendants were represented by criminal attorneysfrom Miami. It is not clear whether the lawyers were privately retained or appointed by the court to represent the defendants. The indictments allege counts of wire fraud, mail fraud and aggravated identity theft. An indictment is merely an allegation by government prosecutors who still have a duty to prove the case beyond and to the exclusion of a reasonable doubt.

The indictment alleges that the Miami mortgage fraud scheme was carried out by the defendants targeting certain pieces of property. Once they located a property of interest, they would contact the sellers and offer to purchase the residence at a significant premium to the asking price. Another individual would falsely inflate the estimate and provide false documentation supporting the increased estimated value. Other co-conspirators would prepare falsified real estate documents, many times using the names and social security numbers of unsuspecting bystanders. Another defendant would fill out false financial affidavits verifying the purported buyer's employment with his company. The real estate documents, fake appraisals and falsified income verifications would be submitted to the lending institutions to effectuate receiving the inflated loan.

After JP Morgan processed the loan, the defendants received the difference between the actual price and the inflated price and split the cash among themselves. After the receiving the money, the homes soon fell into foreclosure. The investigation revealing the fraud was conducted by both the state and federal authorities. The Secret Service, the FBI and the Miami-Dade Police Department all played major roles in uncovering the crime. All of the agencies worked in conjunction under the umbrella of the Mortgage Fraud Strike Force. The case goes to show that mortgage fraud can be committed by everyone in the chain necessary to obtain a mortgage including real estate agents, mortgage brokers, processors, borrowers, appraisers and lawyers.

While the media is replete with mortgage fraud cases, the number of cases should be on the decline because the banks have placed safeguards on their lending practices meant to limit the amount of fraudulent real estate transaction that can be committed. With the number of backlogged fraud investigations, the prosecutions involving real estate fraud could be on the courts dockets for a couple more years to come. Remember, if you or anyone you know is contacted by law enforcement officer regarding a real estate transaction, contact a Miami criminal defense law firm experienced in these types of investigations to get the best representation possible.

Identity Theft, Mortgage Fraud Scammers Arrested, Examiner.com, March 24, 2010