Grand Jury Indicts 5 in $9M Mortgage Fraud Scheme
A federal grand jury returned an eight-count indictment this week charging five individuals relating to their operation of a mortgage fraud conspiracy in the Dallas-Fort Worth, Texas (DFW) area.
Fredrick Lee Moore, 38, Dallas, Texas; Fredrick Barnard Lynch, 39, Desoto, Texas; Randell Dean Miller, 43, Arlington, Texas; Halid Amer, 39, Grand Prairie, Texas, and Theresa Fey Barsema, 48, Mesa, Arizona, are each charged with one count of conspiracy to commit wire fraud and bank fraud. Miller appeared before U.S. Magistrate Judge Paul D. Stickney. Moore and Lynch will make their initial appearances before Judge Stickney. It is anticipated that Amer will appear before Judge Stickney, and Barsema will make her initial appearance at a later date before a U.S. Magistrate Judge in Arizona.
Defendants Fredrick Moore is also each charged with two counts of bank fraud, four counts of wire fraud and one count of engaging in a monetary transaction with criminally derived property.
Defendant Theresa Barsema is charged with one count of bank fraud, four counts of wire fraud and one count of engaging in a monetary transaction with criminally derived property.
Defendant Fredrick Lynch is also charged with four counts of wire fraud.
Defendant Randell Miller is also charged with one count of wire fraud and one count of bank fraud.
Defendant Halid Amer is also charged with three counts of wire fraud.
According to the indictment, Frederick Moore was involved with Empirical Investments, a real estate entity. Fredrick Lynch was involved with ADJ Mortgage, PLLC, also a real estate entity. Randell Miller was involved with Benchmark Mortgage and Supreme Lending; Halid Amer was involved with Accurate Investments, and Theresa Barsema was a licensed escrow officer who worked at First American Title Insurance, Alamo Title Company, First Commitment Title, First Land Title and Capital Title of Texas, in Flower Mound, Texas.
The indictment alleges that from April 2005 to April 2007, the defendants ran a scheme in which they located single-family residences for sale in the DFW area, including excess inventory, distressed and pre-foreclosure properties, and negotiated a sales price with the seller. They fraudulently received loan proceeds when they submitted various fraudulent invoices to the title companies that falsely represented that the defendants had performed various work related to the property, such as various consulting or legal services. The defendants deceived lenders when they caused the sellers to sign an "Authorization for Disbursement of Proceeds" to provide a means for the conspirators to receive part of the loan proceeds without disclosing the disbursement on the HUD-1 Settlement Statement.
The defendants recruited individuals to act as "straw purchasers" or "straw borrowers," promising to pay them a bonus or commission of between $3,500 and $25,000 for their participation in a particular real estate transaction. The conspirators caused the loan applications for each straw borrower to include false financial information, often including inflated false income figures to conceal the borrower's true financial condition so that the lender would more likely approve the loan. The conspirators concealed from the lenders the true status, financial condition and intentions of the named borrowers, knowing that loans would not likely be approved if the lender knew the true role, credit worthiness, and risk of each straw borrower. The conspirators falsely represented in loan documents that the straw purchaser intended to use the property as their primary residence, intentionally concealing from lender that each straw borrower, viewed himself as an "investor," who never intended to occupy the home.
The scope of the conspiracy involved approximately 23 fraudulent residential property loan closings resulting in the funding of approximately $8.8 million in fraudulent loans. Properties noted in the indictment include:
959 Fairway Drive, Duncanville, Texas
4006 Mendenhall Drive, Dallas
5828 Mossbrook Drive, Dallas
1525 Registry Drive, Desoto, Texas
4007 Bowden Hill Lane, Colleyville, Texas
5813 Hunter Trail, Colleyville, Texas
6909 Admiral's Cove Court, Plano, Texas
1414 Travis Circle North, Irving, Texas
An indictment is an accusation by a federal grand jury and a defendant is entitled to the presumption of innocence unless proven guilty. If convicted however, the conspiracy and each bank fraud counts carries a maximum statutory sentence of 30 years in prison and a $1 million fine. Each of the wire fraud counts, upon conviction, carries a maximum statutory sentence of 20 years in prison and a $250,000 fine. The money laundering count carries, upon conviction, up to 10 years in prison and a $250,000 fine, or twice the amount of the criminally derived property received. In addition, restitution could be ordered. The indictment also includes a forfeiture allegation which would require the defendants, upon conviction, to forfeit the total amount of proceeds obtained, directly, or indirectly, as a result of the offense.
U.S. Attorney James T. Jacks of the Northern District of Texas announced the chares.
This case was brought in coordination with President Barack Obama's Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information about the task force visit: http://www.stopfraud.gov
The case is being investigated by the FBI and Internal Revenue Service - Criminal Investigation. Assistant U.S. Attorney David L. Jarvis is in charge of the prosecution.
0 comments • David Saks • June 29 2011 02:12PM