Deputies received information through Sheriff Joe Arpaio’s illegal immigration hotline that Raphael Libardi, the co-owner of the business, is in the country illegally from Brazil and that he was using the social security number of a deceased person.

Libardi was booked on felony identity theft and mortgage fraud charges under suspicion of using the deceased person’s social security number to purchase two vehicles and two homes (one of which has been foreclosed on). Two adult children of Libardi’s, Ive Libardi (25) and Isac Libardi (20), were also arrested at the business for suspicion of being in the country illegally.

Aracruz International is a supplier of granite counter tops which employs between 15-20 people and is believed to generate about $1.9 million in annual sales.

During the execution of that warrant other employees, some of which were related to Libardi, were also found to be in the country illegally.  

It has been noted that Libardi has donated $5,000 annually to the Republican Congressional National Committee.

During the course of 21 employer sanctions investigations, the Sheriff’s Office has arrested 166 out of 262 illegal aliens for felony identity theft and forgery charges.

“Identity theft is a serious crime. Despite the fact that it seems the President of the United States and the U.S. Secretary of Homeland Security will shift their focus to only go after employers, I will continue to pursue all illegal aliens in business establishments who take away valuable jobs from U.S. citizens” Arpaio says.

Frederick Earle Deen, III, pleaded guilty to one count of wire fraud and one count of tax evasion. He entered his plea July 1 in St. Paul before United States District Court Judge Richard Kyle. Deen was charged on April 21. According to Deen’s plea agreement, he admitted that from September 2005 to July 2007 he, along with four unnamed individuals, knowingly and willfully engaged in a scheme to commit wire fraud. _____________________________________________________________________________________________

Additional Materials

• Press Release
• Criminal Information

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Deen was a loan officer and part-owner of Legacy Lending, a mortgage brokerage company in Minnesota. The others involved in the mortgage fraud scheme include the co-owner of the mortgage brokerage company, a residential real estate appraiser, a real estate agent and someone who recruited individuals to act as “straw buyers” for real estate transactions in which mortgage loans were obtained for dollar amounts substantially in excess of the purchase price.

Deen admitted that payments from those mortgage loan proceeds were concealed and diverted to himself and his co-conspirators through the use of fraudulent underwriting and closing documentation which they submitted to lenders to induce the lenders to provide mortgage loans. The funds in excess of the purchase price were then misappropriated by the scheme’s participants.

Deen also admitted that he acted as the loan officer on most of the transactions, causing fraudulent loan application documentation to be provided to potential lenders for purposes of loan underwriting. The fraudulent documentation misrepresented the true terms of the proposed transaction, such as falsely identifying the purchaser; falsely indicating that the property would be “owned-occupied;” inflated the borrower’s income and/or assets; inflated the purchase price of the property; inflated the appraised value of the property; failed to disclose to the lenders that funds in excess of the actual purchase price would be misappropriated by the co-conspirators; and concealed payments that were to be made from the loan proceeds to Deen and others.

This case is the result of an investigation by the Federal Bureau of Investigation and theInternal Revenue Service-Criminal Investigation Division. It is being prosecuted by Assistant U.S. Attorneys Timothy C. Rank and Christian S. Wilton.

The false representations and omissions were material because mortgage lenders rely on the actual purchase price paid by the buyer to assure that the loan is fully collateralized by a realproperty of a sufficient value. The fraudulent payments of loan proceeds to the co-conspirators were also concealed from the lenders.

Individual B owned the mortgage brokerage company through which most of the fraudulent mortgage transactions were conducted. In every transaction, in addition to the concealed payments, Deen admitted that he and Individual B received substantial fees for arranging the fraudulent transactions.

In order to support the falsely overstated purchase price, the conspirators obtained fraudulently inflated appraisals from Individual C, the real estate appraiser. As a result, Individual C was paid funds in excess of a standard appraisal fee.

Individual D acted as the buyer’s real estate agent on multiple real property transactions, and knew that the documents submitted to the lenders falsely identified the straw buyers as the purchaser of the properties when in fact the actual purchaser was Individual E. Individual D was paid substantial commission payments on these fraudulent transactions.

Individual E recruited straw buyers and was paid a portion of the funds misappropriated by the scheme’s participants.

Deen admitted participating in 27 separate fraudulent real estate transactions, worth approximately $18 million in total loan proceeds. There was at least $2 million made in fraudulent concealed payments.

In order to effect the scheme, Deen admitted that on Oct. 17, 2006, in furtherance of the scheme he knowingly transmitted by means of wire communications more than $575,000 in mortgage loan financing for the purchase of a residence in Otsego. During tax years 2006 and 2007, Deen also admitted that he evaded his personal income taxes on approximately $200,000 in taxable income and owes more than $50,000 in income tax.

Deen faces a potential maximum penalty of 20 years in prison on the wire fraud count and five years on the tax evasion count. Judge Kyle will determine Deen’s sentence at a future date.  

Additional Materials

• Press Release
• Indictment [1.7mb]

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Benjamin Tubbs, 49, of Pickerington, Kevin Murphy, 50, of Blacklick, and Karl Mullins, 33, formerly of Columbus and now residing in Florida, are alleged to have acted as the mortgage brokers and orchestrators of a scheme to buy and sell houses at highly-inflated prices and to falsify loan documents in order to skim ten of thousands if not hundreds of thousands of dollars from each sale.

Tubbs, Murphy and Mullins operated under the business names of Premier Mortgage Funding, North American Real Estate Services, One Residential and other names in a scheme that allegedly netted the group millions of dollars in fraudulent loan proceeds. Tubbs, Murphy and Mullins face charges including engaging in a pattern of corrupt activity, theft, receiving stolen property, and money laundering.

Cynthia Underdew, 53, of Columbus, also alleged to be among the primary orchestrators of the scheme, acted as a loan officer and mortgage loan coordinator for many of the loans involved, though investigators indicate she was not licensed to perform such work. Charges against Underdew include engaging in a pattern of corrupt activity, theft, identity fraud, falsification, and receiving stolen property. Underdew and Tubbs also are alleged to have fraudulently purchased properties using the personal identifying information of other individuals without their authority or permission.

Karen Axline, 48, of Granville, was indicted on charges of engaging in a pattern of corrupt activity and receiving stolen property. Axline operated the now-defunct Granville Title Agency in Granville and is alleged to have colluded with Tubbs, Murphy, Mullins and Underdew in structuring many of the transactions to deceive lenders.

Kevin Gray, 48, of Reynoldsburg, is alleged to have been a co-conspirator who purchased and sold a number of properties and is alleged to have laundered thousands of dollars in illicit proceeds. Charges against him include engaging in a pattern of corrupt activity, theft, money laundering, and receiving stolen property.

Real estate agents Nina Masseria and Tim Arrington of Carriage Trade Realty are alleged to have been involved in four of the sales and each was indicted on a charge of engaging in a pattern of corruptactivity. Appraisers Joseph Colegrove and Scott Walisa and Assistant Appraiser Terri White face charges including engaging in a pattern of corrupt activity, theft, and falsification.

Earron West, 38, of Columbus, allegedly acted as a loan officer in three of the transactions in question and was indicted on charges including engaging in a pattern of corrupt activity, theft, falsification, money laundering, and receiving stolen property. Nina Dearing, 29, of Columbus, is accused of purchasing and selling some of the properties involved and faces charges including engaging in a pattern of corrupt activity, theft, receiving stolen property, and money laundering.

Investigators report that more than 30 loan transactions are at issue in this case and some properties were recycled through multiple fraudulent loan transactions. It is alleged that loan applications and documents were falsified on behalf of borrowers, and that orchestrators made down payments allowing borrowers to secure loans in which tens of thousands of dollars were laundered through fictitious home contractor companies.

Further, most of these loans ended in foreclosure, exacting a detrimental toll on the neighborhoods within which the properties are located. Many of the houses are located in urban areas of Columbus that have experienced a stream of foreclosures in recent years.

Some of the properties involved in the transactions in question include homes located at the following Ohio addresses:
988 S. Champion, Columbus
57 S. Champion, Columbus
1001-1003 Linwood, Columbus
1638 Granville, Columbus
471 S. Champion, Columbus
70 Wilson, Columbus
1590 Cordell, Columbus
1611 Sullivant, Columbus
49 N. Ohio, Columbus
932 Bryden, Columbus
1227 Bryden, Columbus
357 Linwood, Columbus
153 Monroe, Columbus
1000 Studer, Columbus
256 E. North Broadway, Columbus
106 Tar Heel, Delaware

The indictments come as the result of a multi-agency collaboration among local, state and federal investigators in conjunction with the Ohio Organized Crime Investigations Commission. That collaborative body, known as the Central Ohio Mortgage Fraud Task Force, investigated the case over the past year. The task force is led by the Columbus Division of Police Economic Crime Unit. Other members of the task force include the Office of Inspector General for Housing and Urban Development, the Upper Arlington Police Department, the office of Ohio Attorney General Richard Cordray, the Internal Revenue Service, the U.S. Postal Inspection Service and the office of Franklin County Prosecutor Ron O’Brien.

In addition to the indictments and resulting arrests today of Murphy, Underdew, Gray, Masseria and
White, task force partners report that a 2002 Jaguar XJ Sport automobile was seized; the car is believed to have been purchased with proceeds from the scheme.

Investigators report that as the investigation continues, more people could be charged.

The defendants, who formerly resided on Kramer Street, Staten Island are accused of a top count of Grand Larceny in the 1st Degree, a Class B felony, punishable by a maximum penalty of up to 25 years in prison.
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Additional Materials

• Press Release
• Indictment

Picture courtesy of silive.com___________________________________________________________________________________

District Attorney Donovan stated, “As part of this mortgage fraud scheme, these defendants are alleged to have victimized new homeowners and their franchiser by accepting payment for mortgage fees, mortgage taxes, customer fees, real property filing fees, and escrow account funds and then misappropriating the funds for their own purposes. They are also alleged to have failed to file any tax returns to the State of the New York, depriving our state of essential funds for services such as healthcare and education.”

The District Attorney further stated that the defendants were franchisees of Fidelity National Title, a Jacksonville, Florida based title insurance company. The defendant’s operated their business from an office suite located at 1100 South Avenue, Staten Island.

The defendants [were] arrested Tuesday in Pennsylvania and were arraigned on the charges today in State Supreme Court before Justice Leonard P. Rienzi who ordered the defendants held on $150,000 bail until their next court date on July 22, 2009. In addition to the top charge of Grand Larceny in the 1st Degree, the defendants are also charged with one count each of Repeated Failure to File Personal Income and Earning Taxes, a Class E felony.

The case against Joseph DeVito and Mary Ann Palladino-DeVito is being prosecuted by Assistant District Attorney Om Kakani of the Investigations Bureau under the supervision of Assistant District Attorney Mario F. Mattei, Bureau Chief. The investigation was conducted by Richmond County District Attorney’s office forensic accountant Dominick Perrotta.

Joseph DeVito and Mary Ann Palladino-DeVito are represented by Manuel Ortega, Esq. and Michael Harding, Esq, respectively. The public is reminded than an indictment is merely an accusation, and that the defendants are presumed innocent until proven guilty in a court of law.

The U.S. Department of Housing and Urban Development’s Federal Housing Administration guarantees home mortgage loans for low and low-to-moderate income families. The settlement resolves allegations that when Beazer Mortgage Corp. made Federal Housing Administration (FHA) insured mortgage loans for the purchase of homes built by Beazer Homes USA Inc., the companies fraudulently and improperly: 1) required purchasers to pay “interest discount points” at closing, but then kept the cash and failed to reduce interest rates; 2) provided cash “gifts” to home purchasers through certain charities, so purchasers could come up with minimum required down payments, with assurances the “gifts” would not have to be repaid, and then increased home purchase prices to offset the amount of the gifts; 3) obscured which of its branches made defaulting mortgage loans to avoid FHA detection of excessive default rates, and; 4) ignored “stated income” requirements in making loans to unqualified purchasers.

As a consequence, unqualified home buyers were induced to enter into FHA insured mortgages, interest rates for and the amount of FHA insured mortgages were improperly inflated, and Beazer Mortgage branches involved in fraudulent activity were hidden from the FHA. In some instances, mortgages that resulted from these fraudulent activities defaulted. When they did so, holders of the loans made FHA mortgage insurance claims and the FHA was wrongfully required to pay inflated claims, and to pay for the management, maintenance, rehabilitation and marketing of defaulted properties.

The settlement is in conjunction with a Deferred Prosecution Agreement (DPA) entered into between the companies and the U.S. Attorney’s Office for the Western District of North Carolina, also announced today. The DPA provides for restitution to private homeowners who were victims of the companies’ fraudulent activities, as well as to the FHA.

“Fighting mortgage fraud is a top priority for this Administration, especially when public dollars are at stake,” said Assistant Attorney General Tony West, who heads the Civil Division. “We will aggressively pursue fraud claims against federal mortgage insurance programs, which are so vitally important to this economy.” Assistant Attorney General West commended both the United States Attorneys’ Office and HUD for their work on this lawsuit and stressed that this is an example of the success that can be achieved when there is collaboration among agencies.

“This action shows that the Administration is serious about making the housing market safe from mortgage fraud and will crackdown on those who violate the trust of American homebuyers,” said HUD Secretary Shaun Donovan. “At this time of uncertainty in the mortgage market, it is especially important that lenders, including builder-affiliated lenders, are held to the highest standards of conduct.”

“Ohio has zero tolerance for these predators,” Attorney General Cordray said. “They prey on Ohioans who are vulnerable and are seeking answers during desperate times. We issued warnings last month ordering them to stop their illegal practices, but they continued anyway. Now, we will work through the courts to stop them permanently.”

According to Cordray’s lawsuit, Cleveland-based Foreclosure Home Assistance, LLC (which also does business as Global Home Rescuers, Homesavers USA, AW Gordon and Associates and Gordon and Associates.) charged consumers $1,500 for loan modifications, forbearance plans and other foreclosure prevention services. In some cases, the company offered foreclosure protection to tenants, claiming it could transfer the property deed from the landlord to the tenant. Despite its promises, the company failed to deliver.

Michael Brotherton, operating as Financial Emergency, Inc., offered similar foreclosure prevention services in Greene County. According to Cordray’s lawsuit, Brotherton advertised his services on the Internet and through the mail. Brotherton charged consumers up to $1,269, saying he could work with lenders and creditors to negotiate debt settlements or workout agreements with mortgage holders. Brotherton failed to deliver.

Also failing to deliver was 21st Century Legal Services, which promised to help homeowners restructure their home loans, a promised service for which they charged $1,500 to $2,600. According to the lawsuit, the company instructed consumers to stop making payments on their home loans and to stop contacting their lenders. Consumers were instructed to make out several post-dated checks, each approximately equal to their monthly mortgage payment, and believed 21st Century would take care of the rest.

Attorney General Cordray’s lawsuits charge each company with violations of Ohio’s Consumer Sales Practices Act and Debt Adjusters Act. Cordray asks the court to hold the companies responsible for reimbursing consumers and to assess a $25,000 civil penalty for each violation.

“In all three of these cases, we believe more victims are out there,” said Cordray. “If you or someone you know has fallen victim to these operations I strongly urge you to contact my office.”

Today’s lawsuits against 21st Century Legal Services and Foreclosure Home Assistance, LLC are the result of a first wave of 13 cease and desist notices issued by Cordray in May. This month, Cordray issued 10 more cease and desist notices and subpoenas to foreclosure rescue operations targeting Ohioans. The cease and desists demand that the companies halt all predatory practices and the accompanying subpoenas require information to substantiate current practices.

For more information or to file a consumer complaint, contact Attorney General Cordray’s Office at www.SpeakOutOhio.gov or (800) 282-0515.

“The conduct charged in these indictments is unconscionable. It is the kind of greed-driven fraud that is harmful not only to those who were directly victimized but, ultimately, to consumers and legitimate businesses throughout the industry. We are committed to identifying, investigating and prosecuting this type of crime,” said Milgram.
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Additional Materials

• Press Release
• Reid et al indictment (Case 1)
• Coscolluela indictment (Case 2)
• Givens indictment (Case 3)

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Case One

Charged in a 17-count State grand jury indictment with conspiracy, eight counts of theft by deception, seven counts of identity theft and one count of money laundering are Yi Feng Reid, 48, of Closter, Bergen county, and Yu Jane Chen, 42, whose last known address was Philadelphia.

Charged in the same indictment with one count each of conspiracy, theft by deception and identity theft are George Liu, 33, and Ji Gang Chen, 53. Both men once lived in New York, and now reside in China.

According to Division of Criminal Justice Director Deborah Gramiccioni, defendants Reid and Yu Jane Chen both were involved in the mortgage and small business loan industry in the Bergen County area, and unlawfully used the identities of other people to obtain mortgages, other types of loans and unauthorized credit card accounts from 2004 through mid-2007.

Gramiccioni said some victims of the alleged identity theft gave Reid and Yu Jane Chen their personal and financial information in the process of seeking, and ultimately obtaining, a loan. In other cases, victims provided their personal information while beginning the loan process, then changed their minds and elected not to seek a loan.

Those who provided Reid and Yu Jane Chen with identifying information later learned their names had been used to secure unauthorized mortgages, loans and credit cards.

Reid and Yu Jane Chen are accused of being the principal co-conspirators. With their help, co-defendant George Liu allegedly obtained two mortgages on a family member’s house totaling $314,000 by using that relative’s identity, along with false tax returns and phony employment information. Co-defendant Ji Gang Chen, also assisted by Reid and Yu Jane Chen, allegedly obtained four mortgages on a family member’s house totaling $446,000 by using the family member’s identity, as well as false employment and wage information.

In all, the four defendants are charged with obtaining seven mortgages totaling $850,000 by using stolen identities and false information. In addition, 13 bank-approved loans and credit accounts worth a total of more than $300,000 were opened using stolen identities. Numerous banks in Pennsylvania, New Jersey and New York were defrauded.

Among other things, Reid and Yu Jane Chen allegedly used checks, credit card transactions and cash proceeds from their unlawfully-obtained accounts to make ATM withdrawals, and to buy goods at supermarkets, gas stations, toy stores, jewelry stores and other retail outlets. Other credit and cash proceeds were allegedly used to pay for ponies to entertain Reid’s child, to pay Reid’s nanny, to pay for the EZ Pass account of a Reid family member and to pay the expenses of Reid-operated businesses.

Yu Jane Chen allegedly used credit and cash proceeds to make a variety of jewelry purchases, and to pay the expenses of several businesses in which she was involved. Thousands of dollars also went to pay a spiritual adviser shared by both Reid and Yu Jane Chen. In some cases, proceeds from the unauthorized loans were used to make payments on other fraudulently-obtained credit accounts.

Most offenses charged in the Reid/Yu Jane Chen indictment are second-degree.

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Case Two

In an unrelated indictment, commercial loan broker Ramon Coscolluela, 30, of Union, was charged by a State grand jury with one count each of theft by deception (second degree) and attempted theft by deception (second degree).

Coscolluela, owner of Templar Group LLC of Newark, allegedly falsified five loan applications submitted to Commerce Bank in 2007 and 2008 on behalf clients who paid him fees ranging from $1,000 to $6,000.

Four of the loan applications were rejected, but a fifth loan request for $100,000 was granted. When the borrower defaulted on the loan, it prompted a bank review of the other four applications Coscolluela had submitted.

Each of the applications was allegedly found to contain inflated or false information not supplied by Coscolluela’s clients. Applications submitted by Coscolluela on behalf of his clients typically contained false information about the liquid assets they possessed, the value of their homes and/or the net worth of their businesses. Coscolluela’s clients were never refunded the fees he charged them.

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Case Three

In a third mortgage-fraud indictment, Terrance Givens, 32, of East Orange, was charged with one count of theft by deception (second degree.)

According to Criminal Justice Director Grammicioni, Givens lied about his employment history on a mortgage application in 2005. Specifically, he falsely listed his employer as Wall Designs, Inc. of Newark, a business founded by a relative that, for all intents and purposes, never existed.

In addition to misrepresenting his employment history to the New Century Mortgage Company, Givens allegedly submitted false W-2 forms for the years 2002, 2003 and 2004 showing annual wages of between $67,000 and $72,000.

On the basis of the false information he provided, Givens was approved for, and received, a $200,000 mortgage loan which subsequently went into foreclosure.

An indictment is merely an accusation. All defendants are presumed innocent until proven guilty. Second-degree crimes carry a penalty of between five-and-10 years in prison and fines ranging from $150,000-to-$500,000 per offense.

Additional Materials

• Indictment
• Oregon DCBS Records

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Han is accused of knowing that he had supplied false supporting documentation, including bank statements, in support of false financial qualifications for the borrower. As a result the borrower obtained a mortgage loan in the approximate amount of $259,950. 

Oregon DCBS records show that Han’s originator status is shown as Inactive and at the time of these alleged offense he was employed by TTM Financial of Portland, OR.

It is alleged that Lucescu, acting as a residential mortgage loan broker, prepared uniform residential loan applications (1003’) on behalf of Cristina Miu and that he knowingly falsified the borrower’s financial qualifications on those applications. He failed to identify other residential loans on properties that were owned by the borrower. He disguised the true nature of the loans and describe all five as owner-occupied purchases when in fact they were for investment purposes.
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Additional Materials

• Indictment
• Oregon Loan Originator Records

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In total Miu obtained approximately $896,050 in mortgage loans, including 2^nd liens, on the following 3 properties:

• 5032 SE 33rd, Portland, OR
• 6220 SE Salmon St., Portland, OR
• 6645 SE 63rd, Portland, OR

At the time of these allegations Lucescu was employed by American Capital Mortgage Corp of Portland, Oregon.

Additional Materials

• Indictment
• Oregon DCBS Loan Originator records

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The indictment states that at this time Surprenant, was a residential mortgage loan broker and he prepared a uniform residential loan application (1003) for a mortgage to be obtained in his own name and on that application he knowingly falsified his financial qualifications. He then created false supporting documentation, including pay stubs, to support his employment and income details.

He is then alleged to have inflated the sales price of the residence in order to receive a kickback from the seller outside of the closing of the transaction.

Finally it is alleged that he knowingly identified a co-worker, Adam Durham, as the mortgage broker of record, and forged Adam Durham’s signature on the uniform residential loan application.

Oregon DCBS records show that Surprenant’s loan originators license is inactive and that between 11/08/2004 and 5/23/2007 he was employed by W. J Bradley Mortgage Capital Corp.

Additional Materials

• Press Release
• Complaint

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Backstrom said that the Minnesota Department of Commerce received information in 2008 about a possible insurance fraud case involving Singramdoo. Singramdoo was licensed as a real estate closer, insurance producer and notary public and worked as an independent closer for a Burnsville title and real estate company from February 2004 through February 2008. As part of her duties, she performed real estate closings, including preparing and distributing checks from the firm’s trust and title insurance accounts. The investigation found that Singramdoo engaged in a pattern of insurance/mortgage fraud resulting in total losses exceeding $220,000.

The investigation revealed that Singramdoo used several methods to accomplish her thefts: (1) she would write checks for her personal bills or bills of other family members as part of a real estate closing and then enter those payments directly on mortgage forms as if the obligation was owed by the buyer or seller in the transaction; (2) she would accurately prepare documents for purposes of real estate closings and subsequently change the forms at a later date to reflect fraudulent payments; and (3) she would issue valid checks for payment as part of closings, but would never tender them to the payee and would subsequently reissue the checks to pay her own or her family member’s creditors.

Singramdoo admitted to the Department of Commerce that she embezzled her client’s funds by issuing checks for her own benefit and her licenses were suspended in March of this year. She claimed to have had overwhelming personal debts for which she used the embezzled funds.

Backstrom commented: “This is the fifth theft-related case exceeding $150,000 that we have filed in Dakota County this year, compared to five such cases filed in all of 2008. This is a disturbing trend which we hope ceases.”

Backstrom said that Singramdoo made her first appearance in court today. Judge Martha Simonett did not impose bail. Her next court appearance will be on July 13th at 9:00 a.m. in Hastings. Backstrom praised the Minnesota Department of Commerce for its thorough investigation into this matter.

As part of the scheme both of them are accused of preparing applications which contained materially false and fraudulent representations, including details of assets, down payments and source of income. In addition they disguised the extent of Scherlings mortgage liabilities by submitting applications for multiple loans within days or weeks of each other. Monies from the scheme were disbursed to an account in the name of Core Limited, LLC which was controlled by Scherling.
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Additional Materials

• Indictment
• DeGrande Realtor License Details
• DeGrande license revocation order
• Rocky Mountain News Audio Slideshow [you will leave this site]
• Rocky Mountain News Article about DeGrande [Link] [PDF]

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The properties listed in the indictment are:

1216 Beulah Avenue, Pueblo
1218 Beulah Avenue, Pueblo
1225 Beulah Avenu Pueblo
1420 Cedar Street, Pueblo
921 E. 7th Street, Pueblo
2222 Balboa Road, Pueblo
3801 Farabaugh Lane, Pueblo
3805 Farabaugh Lane, Pueblo
916 S. Harmony Drive, Pueblo
920 S. Harmony Drive, Pueblo
2507 E. Orman Avenue, Pueblo
600 W. Arroyo Drive, Pueblo
1937 Carteret Avenue, Pueblo
1929 Euclid Avenue, Pueblo
1728 Evans Avenue, Pueblo
1905 E. Evans Avenue, Pueblo
3939 Lancaster Drive, Pueblo
716-718 Clarion Drive, Pueblo
1909 & 1911 Jones Avenue, Pueblo
3930 Devonshire Lane, Pueblo
3301 Lancaster Drive, Pueblo
1623 Wabash Avenue, Pueblo

Pictures Courtesy of The Rocky Mountain News (now closed)

 
Danny DeGrande - on right                           DeGrande’s former golf course home

The Pueblo Chieftain quotes Jeffrey Dorschner, a spokesman for the U.S. Attorney’s office, as saying “Even by Denver standards, I think this is a big case,”

Previous newspaper reports are quoted as saying that DeGrande’s activities caused more than 150 foreclosures and caused the head of the Colorado Department of Real Estate to say his dealings were “revolting”.

Craig Heller, 49, has been charged with for Grand Larceny in the Second Degree, Grand Larceny in the Third Degree, and Scheme to Defraud in the First Degree. He faces up to 15 years in prison if convicted. He is due back in court June 25.

Rice said that in June 2007, Heller was hired by a divorced couple to manage their debt consolidation. The ex-husband, of Bethpage, and ex-wife, of Seaford, each put $10,000 into an escrow account for Heller to pay their bills. Each party also agreed to pay Heller a $2,500 fee for his services. Heller soon received complaints from the ex-wife after she realized he was not paying off their debts. Heller agreed to repay both the $20,000 with interest and a portion of the attorney’s fee on Dec. 31, 2008. The money, however, was never repaid.

In a separate incident, Heller, acting as escrow agent, was hired in November 2007 to remit a settlement check for more than $82,000 to the partial owner of a piece of Brooklyn property that was sold. The closing took place on April 18, 2008, but Heller never gave the victim, of Brooklyn, a check. He was ordered to pay the amount on Dec. 18, 2008, but failed to do so. As in the other case, Heller promised numerous times to pay his victim.

“Instead of performing the task he was hired for, this attorney robbed his victims blind,” Rice said. “Attorneys are in positions of trust, and wearing a suit and tie while you steal doesn’t make it any less egregious.”

Assistant District Attorney Megan Gallagher of the DA’s Government & Consumer Frauds Bureau is handling the case for the District Attorney’s Office. The defendant is represented by Joseph Megale, Esq.

The charges are merely accusations and the defendant is presumed innocent until and unless proven guilty.

Mayer Goldberger, 50, of Sunset Park in Brooklyn, has been charged with Grand Larceny in the First Degree, Criminal Possession of a Forged Instrument in the Second Degree, and Scheme to Defraud in the First Degree. He faces up to 25 years in prison if convicted. He was arrested Wednesday morning by DA Investigators. He is scheduled to arraigned Wednesday in First District Court, Hempstead.

Rice said that between May 1, 2008 and July 14, 2008, Mayer Goldberger secured a short-term loan in the amount of $2.3 million from BRT Realty Trust, a real estate investment trust located in Great Neck, New York. The loan was to be secured by a first mortgage on real property owned by Hartford LLC and located in Connecticut, and the personal guarantee of Goldberger.

As part of the criminal scheme, Goldberger caused a title report to be prepared by Speedy Title Services LLC, a company created by Goldberger in June 2008. The report failed to disclose material information, including the existence of a recorded and outstanding 2007 mortgage on the property which was issued by Hartford LLC to New York Community Bank in the amount of $3 million, but did include an apparent bogus 2007 mortgage allegedly issued by Hartford LLC to Hartford & York LLC, another company in which Goldberger was the sole member, in the amount of $2.8 million.

In addition, through Speedy Title Services, Goldberger caused a fraudulent Title Commitment and Policy of Title Insurance purportedly issued by First American Title Insurance Company to be presented to BRT. Not only did First American not issue the Commitment and Policy but the authorized signature on First American documents provided by Speedy was that of an individual who had passed away in February 2008, approximately five months before the closing which occurred on July 11, 2008.

On July 14, 2008 the entire $2.3 million was wired into accounts as directed by Meyer Goldberger, including $2 million into the account of Hartford & York. However, the mortgage issued by Hartford LLC to BRT was never recorded and the loan went into default in January 2009 when the entire $2.3 million principal was due to be repaid.

Authorities are still investigating how Goldberger spent the stolen money.

“Bad mortgages, fraudulent loans, and real estate fraud leave honest businesses holding the bag,” Rice said. “Bogus loans like these make it that much harder for honest homebuyers to do business at a fair price.”

Assistant District Attorney and Chief of the DA’s Public Corruption Bureau, Marshall Trager, is handling the case for the District Attorney’s Office. Goldberger is being represented by Robert McDonald, Esq., of Mineola.

The charges are merely accusations and the defendant is presumed innocent until and unless proven guilty.

The information alleges that from August 2003 through January 2005, Tomko and others who were not named executed a scheme to defraud Homecoming Financial Network and People’s Choice Home Loans in connection with twelve mortgage loans. The information further alleges that Tomko and others caused fraudulent loan applications to be processed through mortgage brokers, including CMS Home Loans in Elyria, Ohio, and Allstate Financial Group in Beachwood, Ohio. The information charges that Tomko utilized straw buyers to purchase properties and to obtain financing in their names. The information further charges that Tomko caused fraudulent appraisals to be prepared which falsely and artificially inflated the true values of the properties that were acquired and financed.
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Additional Materials and Information

• Press Release
• Criminal Information

List of Properties (all in Ohio) in Information

3463 East 78th St, Cleveland
1615 Lake Front Ave, East Cleveland
1366 East 111th St, Cleveland
2194 East 97th St, Cleveland
2121 Dowd Ave, Lakewood
1347 East 112th St, Cleveland
3817 Monticello Blvd, Cleveland Heights
4750 Monticello Blvd, South Euclid
7617 Superior Ave, Cleveland
922 Brunswick Rd, Cleveland Heights
7412 Indiana Ave, Cleveland
2033 Revere Rd, Cleveland Heights
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The information also alleges that the loan application packages that were submitted to the lenders included some or all of the following false and fraudulent documentation and information: inflated appraisals, source of down payment, rental income, lease agreements, and forged signatures. The information charges that Tomko and others fraudulently obtained twelve mortgage loans totaling nearly $1.2 million on properties located in the Cleveland, Ohio, area. It is further alleged that Homecomings Financial Network and People’s Choice Home Loans sustained significant losses as these mortgage loans went into default and the properties were sold through foreclosure.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

This case is being prosecuted by Assistant United States Attorney John D. Sammon, following a joint mortgage fraud investigation by the Cleveland Offices of the Federal Bureau of Investigation and the Department of Housing and Urban Development, Office of the Inspector General.

An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.