 Los Angeles Times |
Holder Announces Working Unit on Mortgage-Backed Bonds Fraud
BusinessWeek 27 (Bloomberg) — A new US government unit will investigate misconduct in the bundling of mortgage loans into securities that fueled the housing bubble and contributed to the financial crisis, Attorney General Eric Holder said. Hope for Mortgage Probe Mortgage probe unveiled as foreclosure talks loom Justice Department Unit Issues Subpoenas in Mortgage Fraud Inquiry |
Posts Tagged ‘fraud’
Holder Announces Working Unit on Mortgage-Backed Bonds Fraud – BusinessWeek
Saturday, January 28th, 2012
WMC Probe Focuses on Fraud
Saturday, January 21st, 2012Federal authorities have launched an investigation into defunct subprime lender WMC Mortgage Corp. to determine whether senior managers condoned mortgage fraud, sources said.
The government wants to find out if WMC used fake documents, overstated income and other fraudulent practices in search of loan approvals.
Former WMC employees accuse the company of condoning the bad behavior.
MortgageDaily.com – Mortgage News Headlines
US cricket captain arrested for mortgage fraud scam – Zee News
Monday, December 26th, 2011 Zee News |
US cricket captain arrested for mortgage fraud scam
Zee News New York: US Cricket Team captain Steve Massiah has been arrested in connection with a Queens-based mortgage scam allegedly run by Edul Ahmad, a broker whose 40000 dollars donation to Republican Gregory Meeks is being investigated by the Federal Bureau … Ed Ahmad allegedly recruited Guyanese cricketers as straw-buyers in mortgage … |
For Mortgage Fraud, California Takes the Cake
Wednesday, December 14th, 2011
California is the state with the most costly mortgage fraud, a mortgage industry fraud index reported Tuesday, despite the national fraud level being down quarter-over-quarter.
The Third-Quarter 2011 Mortgage Fraud Index, reported by MortgageDaily.com, shows activity on civil and criminal cases. This quarter the index reported that victim lenders were deceived by fraudulent documentation or inflated appraisals. In California, mortgage fraud totaled $ 204 million, the report states, putting it at the highest level of fraud nationwide.
“Many of the recently opened cases were uncovered by mortgage bankers who were forced to repurchase the loans,” said Mortgage Daily founder and Publisher Sam Garcia.The index fell 7% from the second quarter but climbed 16% from a year earlier. On a dollar basis, the aggregate balance of mortgage fraud cases was $ 1.3 billion—lower than the second quarter and the third-quarter 2010.
On a state index basis, Florida has the highest level, with California ranking No. 2 in terms of mortgage fraud prevalence. New York also saw an increase in fraud during the quarter.
Written by Elizabeth Ecker
Four Charged in $2.5 Million Reverse Mortgage Fraud Scheme
Thursday, July 7th, 2011
Four defendants were charged Wednesday for their roles in a $ 2.5 million Home Equity Conversion Mortgage fraud scheme. The U.S. Attorney’s Office for the Southern District of Florida reports that three of the defendants, Louis Gendason, John Incandela, and Marcus Echevarria, worked at 1st Continental Mortgage in Florida as loan officers; the fourth defendant, Kimberly Mackey, worked as a licensed title agent and proprietor of Real Estate One Land Services, Inc., in Pennsylvania.
These individuals allegedly worked together in a scheme to defraud reverse mortgage borrowers, lender Genworth Financial Home Equity Access, Inc., and the Federal Housing Authority (FHA); if convicted, they will each face up to 30 years in prison and fines of up to $ 1 million.
The three defendants who worked for 1st Continental are charged with soliciting homeowners aged 62 or older to refinance existing home mortgages with reverse mortgages, even if those individuals did not qualify for a reverse mortgage. Gendason allegedly altered home appraisals to inflate the values of the properties so that the seniors would qualify, and these fraudulent appraisals were submitted to Genworth. Genworth subsequently approved the falsified documents, and the FHA insured more than $ 2,572,813 in unqualified reverse mortgage loans.
Mackey, the fourth defendant, allegedly played a role in the scheme by closing the Genworth loans without paying off the defrauded borrowers’ existing mortgage loans. Then, as the designated closing agent for these loans, Mackey received $ 2,572,813.19 in loan proceeds from Genworth, of which she funneled $ 998,086.33 into a bank account controlled by Incandela and Gendason; this money was used by Incandela, Gendason, and Echavarria for personal use, according to the U.S. Attorney’s Office. In order to conceal the fraudulent loan closings, Mackey prepared false HUD-1 settlement documents to the effect that the loans had been closed.
Meanwhile, the unsuspecting homeowners’ original mortgage loans remained open and unpaid, and the defendants allegedly tried to hide the existence of the refinanced reverse mortgage loans from the original mortgage lenders. In order to do this, the 1st Continental employees created fictitious offers for “short sales” on the borrowers’ homes.
U.S. Attorney Wifredo Ferrer, along with several other figures of authority, recently unsealed criminal information relating to the alleged fraud.
“These defendants preyed on senior citizens on fixed and modest incomes. While legitimate loan modifications and reverse mortgages are useful tools to help those who need it, we will remain vigilant to make sure these tools are not misused by those who seek to line their own pockets,” said Ferrer. “We urge potential borrowers to use caution when entrusting their homes and savings to those offering financial alternatives, including loan modifications and reverse mortgages.”
“Combating mortgage fraud is a priority due to the impact of lending and the housing market on the nation’s economy,” said John V. Gillies, Special Agent in Charge for the FBI Miami. “The FBI remains committed to working with our law enforcement partners to routing out this type of fraud.”
Written by Alyssa Gerace