[Editor Note - Below you will find the general part of the press release for Operation Bad Deeds. To make searching, updating and indexing easier the eight seperate cases involved will get their own entry and will be all indexed under “Operation Bad Deeds” to make them easier to find in the future. They are/will be the 8 entries preceding this one.]

In the following press release PREET BHARARA, the United States Attorney for the Southern District of New York, JOSEPH M. DEMAREST, JR., the Assistant Director-in-Charge of the New York Field Division of the Federal Bureau of Investigation (“FBI”), RICHARD H. NEIMAN, the Superintendent of Banks for New York State, RENE FEBLES, the Special Agent-in-Charge of the New York Field Office of the Department of Housing and Urban Development, Office of Inspector General (“HUD-OIG”), BRIAN G. PARR, the Special Agent-in-Charge of the New York Field Office of the United States Secret Service (“USSS”), RONALD J. VERROCHIO, the Inspector-in-Charge of the New York Division of the United States Postal Inspection Service (“USPIS”), and JON T. RYMER, the Inspector General for the Federal Deposit Insurance Corporation, Office of Inspector General (“FDIC-OIG”), announced today the unsealing of charges against 41 defendants, in eight separate cases, for allegedly engaging in various mortgage fraud scams that collectively defrauded lenders out of more than $64 million in home mortgage loans on more than 100 properties across New York State. Among those charged are six lawyers, seven loan officers, three mortgage brokers, an accountant, and a residential property appraiser.

• Fraud 1 - 6 new defendants and new charges in Lavette Bills case. Read more..
• Fraud 2 - 8 charged in “distressed seller” flipping scheme. Read more..
• Fraud 3 - 6 charged in flipping scheme. Read more..
• Fraud 4 - 5 indicted in $13.5 million mortgage fraud. Read more..
• Fraud 5 - 4 indicted in $6.8 million straw borrower fraud. Read more..
• Fraud 6 - 6 indicted in $6 million straw borrower/flipping scheme. Read more..
• Fraud 7 - 3 charged in false appraisal and down payment fraud. Read more..
• Fraud 8 - 2 lawyers charged in straw borrower fraud. Read more..

As part of the coordinated takedown of “Operation Bad Deeds,” a joint federal, state, and local law enforcement operation targeting mortgage fraud crimes, 31 defendants were arrested or surrendered to authorities today in New York, Pennsylvania, Ohio, and North Carolina. One additional defendant is expected to surrender to authorities later today. The defendants taken into custody today are expected to be presented in federal court later this afternoon.

Four of the defendants were previously charged and will appear in Manhattan federal court at a later date, and five defendants remain at large.

The mortgage fraud scams alleged in the cases announced today included, among other things, property flips, equity stripping, and appraisal and loan fraud. In one case, defendants operated a foreclosure rescue scheme, targeting individuals who were on the verge of losing their homes by tricking them into
giving up the equity in the properties with false promises that their homes would be saved.

PREET BHARARA, the United States Attorney for the Southern District of New York, said: “As the U.S. economy struggles, we will continue to have a zero tolerance policy for those who defraud financial institutions and prey on homeowners on the brink of foreclosure. The type of criminal conduct charged today constricts the credit markets and makes it harder for honest people to realize the American dream of home ownership. It is especially alarming when lawyers, loan officers, and mortgage brokers treat their professional licenses as license to loot banks and profit from other people’s pain. Particularly in this down economy, the message to those professionals and their alleged criminal cohorts is simple: we will find you, arrest you, and send you to jail.”

JOSEPH M. DEMAREST, JR., the Assistant Director-in-Charge of the New York Field Division of the FBI, said: “Combating mortgage fraud is a priority because mortgage lending and the housing market have such an impact on the nation’s economy. The defendants charged today include mortgage brokers, lenders, lawyers and buyers. The FBI is aggressively pursuing criminal conduct at every stage of the mortgage process.”

RICHARD H. NEIMAN, the Superintendent of Banks for New York State, said: “A key factor leading to the mortgage crisis was the failure of the gatekeepers — including mortgage brokers and attorneys. Unfortunately, instead of protecting our financial system, in some cases they abused their positions and
joined criminal schemes to steal millions of dollars. The Banking Department’s Criminal Investigation Bureau will continue to work with our law enforcement partners to pursue individuals that, through fraudulent activities, attempt to undermine the financial system.”

RENE FEBLES, the Special Agent-in-Charge of the New York Field Office of the HUD-OIG, said: “One of our government’s most important responsibilities is administering and enforcing our laws that bring a degree of order and protect our citizens from fraudsters and wrongdoers. This joint prosecutorial effort is our continuing demonstration of our commitment to ensuring that mortgage programs remain whole for borrowers throughout the nation.”

BRIAN G. PARR, the Special Agent-in-Charge of the New York Field Office of the USSS, said: “The effects of mortgage fraud continue to adversely impact our nation’s financial systems. The results of this investigation are a testament to the collaborative efforts between the Secret Service and our law enforcement partners. We will continue to aggressively pursue those that victimize our citizens and our banks.”

RONALD J. VERROCHIO, the Inspector-in-Charge of the New York Division of the USPIS, said: “The arrests today are emblematic to the extent Postal Inspectors will work closely with State and Federal agencies to combat fraud which victimizes individuals, the economy, and our neighborhoods.”

JON T. RYMER, the Inspector General for the FDIC said: “The FDIC-OIG is committed to its partnerships with others in the law enforcement community as we address mortgage fraud cases throughout the country. The American people need to be assured that their government is working to ensure integrity in the financial services and housing industries and that those involved in criminal activities that undermine that integrity will be held accountable.”