A federal grand jury in Brooklyn, N.Y. has returned a superseding indictment charging six defendants with a mortgage fraud scheme in which they fraudulently obtained more than $25 million in loans. The indictment alleges the defendants conspired to defraud financial institutions, including Countrywide Financial, Fremont Investment and Loan, IndyMac Bank, National City Corporation, SunTrust Mortgage Inc. and Wells Fargo & Company, and wholesale mortgage lenders, including Lend-Mor Mortgage Bankers Corporation, Mortgage Lenders Network USA, and New Century Mortgage Corporation. Attorneys Matthew Burstein and Aaron Rabinowitz, real estate agent Elias Compres, loan officers Arturo Giraldo and John Constantinides, together with Rolando E. Roldan, are charged with conspiracy to commit bank and wire fraud; Burstein, Compres, Rabinowitz, and Roldan are also charged with wire fraud.
As detailed in the indictment, from January 2001 to July 2010, the defendants obtained mortgage loans from lending institutions through fraudulent means, including submitting false loan applications to make borrowers appear more creditworthy—enabling the defendants to profit from commissions and loan fees—and by preparing documents, such as HUD forms, designed to deceive the lending institutions about the disbursements made at closings. In many instances, the purchasers subsequently failed to make mortgage payments to the lending institutions, and the loans are now in default.
“Our real estate markets rely on the integrity of its members,” Loretta E. Lynch, United States Attorney for the Eastern District of New York. “For almost a decade, these defendants allegedly used a trail of false documents and broken promises to enrich themselves to the tune of millions. We will vigorously investigate and prosecute those—including attorneys and other licensed professionals—who compromise positions of trust and perpetrate mortgage fraud.”
The maximum term of imprisonment for any defendant convicted of conspiracy to commit bank and wire fraud is 30 years. The indictment also seeks forfeiture of the proceeds of the defendants’ crimes, including a criminal forfeiture money judgment and proceeds traceable to the offenses.