New Jersey Attorney General Jeffrey S. Chiesa has announced that five people have pleaded guilty for their roles in a scheme, led by Genilza R. Nunes of Kearny, N.J. (aka Leticia Wilchez, Geny Silva, Gena Nunez and Genilza Borges) to defraud Provident Funding Associates of $431,200 by filing a false loan application and purchasing a home in Newark in the name of a man who was deceased. Nunes pleaded guilty on May 8 to second-degree money laundering before Superior Court Judge Salem Vincent Ahto in Morris County, N.J. Under the plea agreement, the state will recommend that she be sentenced to 10 years in state prison, including two years of parole ineligibility, and be ordered to pay a $150,000 fine.
Paul DiGiacomo of Madison, N.J., a lawyer who laundered stolen funds through his trust account, pleaded guilty to second-degree money laundering before Superior Court Judge Thomas V. Manahan in Morris County, N.J. Under his plea agreement, the state will recommend that he be sentenced to eight years in state prison and be ordered to pay a $150,000 fine.
“Home sales typically involve various professionals, including real estate agents, attorneys, title agents and mortgage brokers, who are responsible for providing multiple layers of review and oversight to prevent fraud,” said Attorney General Chiesa. “In this case, however, we had dishonest operators in every one of those roles, leading the unsuspecting lender to provide a $431,200 mortgage loan to a dead man. We will continue to work diligently to uncover such mortgage fraud schemes and send those responsible to prison.”
Also pleading guilty were:
►Lillian Veras of Kearny, N.J. (aka Lillian Urena), who pleaded guilty on May 14 before Judge Manahan to second-degree money laundering. Veras, a real estate agent and notary, helped prepare false loan documents for the scheme and forged signatures. She faces a recommended sentence of seven years in prison and a $150,000 fine.
►Maureen R. Stillwell of Somerville, N.J., an employee of Ideal Title Agency LLC, who helped prepare false closing documents, pleaded guilty before Judge Ahto on May 8 to second-degree money laundering. She faces a sentence of up to seven years in prison and a $25,000 fine.
►Sheila Zullo of Green Brook, N.J., owner of Ideal Title Agency, pleaded guilty on May 7 before Judge Manahan to third-degree money laundering. She admitted that she illegally distributed the loan funds as escrow agent. She faces a recommended sentence of up to three years in prison and a $150,000 fine.
A sixth defendant, Nuno J. Sousa of Union City, N.J. agreed to be charged by accusation with third-degree securities fraud and was admitted by the court into the Pre-Trial Intervention Program in April. All six defendants who have pleaded guilty or entered PTI are required to pay restitution to the lender, Provident Funding Associates, equal to one-sixth of the $431,200 loan amount, or approximately $71,867 each.
Nunes, the mastermind of the scheme, acted as a principal of Leska Management, a bogus real estate management company. With Veras’ assistance, she arranged for the purchase of a home in Newark from a woman who had fallen behind in her mortgage payments. The seller owed $477,196 on her loan, but the holder of the mortgage, Kondaur Capital Corporation, agreed to a short sale for $260,000 to a purported buyer identified by the defendants. That sale was never completed. DiGiacomo, who held himself out as the attorney for both the buyer and Leska, told Kondaur the sale had fallen through. He then negotiated with Kondaur to assign the mortgage to Leska at a discounted price of $219,877. He never disclosed that, prior to assignment of the mortgage, the home was sold at an inflated price of $539,000 to a fictitious buyer created by the defendants. Nunes, with assistance from Sousa, a mortgage broker, fraudulently applied to Provident Funding Associates for a $431,200 mortgage loan and purchased the home using the identity of a deceased man whose last name was “Benazi.” Nunes created counterfeit bank records, employment records and false identification documents for Benazi for the loan application, and she had another man pose as Benazi at the closing. No payments were ever made to the lender on the loan. The seller was never notified of the closing, and her signature was forged on the closing documents.
Stillwell handled the closing for Ideal Title and assisted in the creation of false closing documents used to deceive the lender. She never collected monies due at closing from the buyer, and falsified HUD settlement statements to indicate that they had been collected and that the prior mortgage had been paid off. In her role as escrow agent, Zullo, the owner of Ideal Title, misappropriated loan proceeds by wiring $376,032 to DiGiacomo’s attorney trust account at Nunes’ direction. DiGiacomo used $219,877 of the misappropriated funds to pay for the assignment of the mortgage and wired the balance of $156,155, representing the net illegal profits, into a bank account controlled by Nunes and Veras. Stillwell, Zullo and DiGiacomo were all compensated for their participation in the scheme.