U.S. Attorney William J. Hochul Jr. has announced that a federal grand jury has returned a 24 count indictment charging Gregory Gibbons of Thornwood, N.Y.; Julio Rodriguez of Bronx, N.Y.; Laurence Savedoff of New City, N.Y.; and Tina Brown of Bronx, N.Y. with conspiracy to commit wire and mail fraud affecting financial institutions, wire and mail fraud affecting financial institutions, and bank fraud. The charges carry a maximum penalty of 30 years in prison and a $1 million fine.
“Persons who engage in mortgage fraud undermine the American dream of home ownership,” said U.S Attorney Hochul. “Such actions, if successful, hurt potential homeowners, banks and government programs designed to assist homebuyers.
Assistant U.S. Attorneys Kathleen A. Lynch and Elizabeth R. Moellering, who are handling the case, stated that according to the indictment, the defendants engaged in scheme to obtain mortgages on behalf of borrowers who would not have otherwise qualified for those loans if their true income, asset and employment information was submitted to the lender for approval and for FHA insurance.
Specifically, to secure a loan, the defendants would submit among other things, employment documents that falsified the purchaser’s income, assets, and place of employment. In addition, the defendants submitted false settlement statements to the banks indicating where the proceeds of the loan were disbursed.
As a result, based on the fraudulent information and certifications submitted, loans amounting to more than $4,100,000 were approved for the borrowers. Subsequently, the borrowers defaulted on the loans and the properties are now in various stages of foreclosure.
"In the last number of years, we have seen enormous and damaging developments in the mortgage and housing markets, said U.S. Housing and Urban Development, Office of Inspector General, Special Agent in Charge Brad Geary. “Indictments, such as this, set an important precedent that this type of behavior will not be tolerated and will be aggressively pursued. We are deeply committed to working in partnership with our federal law enforcement counterparts to ensure that corrupt individuals do not use their positions to enrich themselves at the expense of the government.”
Defendants Savedoff, Rodriguez and Brown were arraigned before U.S. Magistrate Judge H. Kenneth Schroeder Jr. and were released with conditions.
