David Saks: Final Defendant Sentenced to 70 Months for Involvement in Large-Scale Mortgage Fraud Ring In Massachusettes

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Final Defendant Sentenced to 70 Months for Involvement in Large-Scale Mortgage Fraud Ring In Massachusettes

Final Defendant Sentenced to 70 Months for Involvement in Large-Scale Mortgage Fraud Ring

BOSTON, MA-Late yesterday, a loan originator, the 12th and final defendant in a large-scale mortgage fraud ring, was sentenced in federal court for his role in fraudulent property transactions that were part of a larger mortgage fraud conspiracy involving 21 property deals and more than $10.6 million in loan proceeds. In February, Appolon was convicted of wire fraud and conspiring to commit wire fraud following a nine-day jury trial.

Ralph Appolon, 30, formerly of Watertown, was sentenced by U.S. District Judge George A. O'Toole, Jr. to 70 months in prison to be followed by two years of supervised release. The court also entered a forfeiture order of $1.9 million, to be paid by Appolon and other defendants in this case.

"The investigation and prosecution of the defendants involved in this conspiracy required an extensive amount of preparation and government resources," said U.S. Attorney Carmen M. Ortiz. "We hope to send a clear message to those in the real estate and mortgage industry-if you engage in fraud in order to line your pockets at the expense of others, we will spare no expense investigating and prosecuting you."

Between May 2005 and September 2005, Appolon and others participated in a conspiracy to obtain $10.6 million in mortgage loan proceeds by fraud. The scheme involved the use of "straw" buyers, inflated purchase prices, and documents containing numerous false representations, such as false information about purchase price, borrower income, employment, assets, or intent to reside in the properties. The conspiracy involved 21 property transactions in South Boston, Dorchester, Jamaica Plain, Quincy, Hyde Park, and Cohasset. A total of 12 defendants were prosecuted in connection with the conspiracy. Together, the defendants defrauded 10 mortgage lenders of more than $10.6 million in loan proceeds. The mortgages on all of the properties were defaulted upon and nearly all went into foreclosure.

Appolon was convicted on charges regarding two of the properties in South Boston and Dorchester. At trial, the government presented evidence of Appolon's involvement in fraud regarding two additional properties. The difference between actual purchase prices negotiated with sellers and the inflated purchase prices submitted to lenders ranged as high as $80,000 on individual properties. From these fraudulent property transactions, Appolon received over $150,000.

In June 2010, five defendants were convicted of conspiracy and wire fraud counts by a federal jury following a seven-week trial. The conspiracy involved 21 property transactions in South Boston, Dorchester, Jamaica Plain, Quincy, Hyde Park, and Cohasset. Together the defendants defrauded 10 mortgage lenders of more than $10.6 million in loan proceeds. Of the defendants who went to trial last year, Eric L. Levine, a suspended attorney, and J. Daniel Lindley, a practicing attorney, participated in the loan closing process and handled the money in the conspiracy. Ernst Appolon, a real estate broker, identified properties for the conspirators, negotiated purchase prices with sellers, and recruited people to lend their names and credit information ("straw" borrowers) to obtain mortgage loans for property purchases. Latoya Haltiwanger, a mortgage broker, was the loan originator for three of the properties in the conspiracy and was the "straw" buyer for a separate property purchase. Daniel Appolon recruited two "straw" buyers whose name and credit information were used to purchase three properties.

Six other defendants pleaded guilty before the June 2010 trial. Co-defendants Andre Junior Lamerique, Widner Lamarre, Jermaine Blake, Samuel Jean-louis, who were loan originators in the conspiracy, and Jean Noriscat, a recruiter, pleaded guilty to conspiracy to commit wire fraud and several counts of wire fraud. Noriscat also pleaded guilty to several counts of aggravated identity theft. Elizabeth Son had previously waived indictment and pleaded guilty to an information charging her with wire fraud.

In May 2010, Son was sentenced to three years probation with the first six months to be served in a halfway house. In October 2010, the defendants were ordered to serve prison sentences as follows: Appolon (Daniel), 42 months; Jean-Louis, 22 months; Appolon (Ernst), 120 months; Blake, 30 months; Lamarre, 60 months; and Haltiwanger, 30 months. In November 2010, Noriscat was sentenced to 87 months in prison, while Lindley was sentenced to 72 months in prison. In January, Lamerique was sentenced to serve 60 months in prison, and Levine was sentenced to serve 144 months.

U.S. Attorney Ortiz; Richard DesLauriers, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Robert Bethel, Inspector in Charge of the United States Postal Inspection Service; William P. Offord, Special Agent in Charge of the Internal Revenue Service's Criminal Investigation, Boston Field Division; Boston Mayor Thomas M. Menino; and Boston Police Commissioner Edward Davis, made the announcement today. The case is being prosecuted by Assistant U. S. Attorneys Victor A. Wild and Ryan M. DiSantis of Ortiz's Economic Crimes Unit and Mary B. Murrane, Chief of Ortiz's Asset Forfeiture Unit.

Mortgage fraud is a key focus of the Department of Justice who in 2009 created the Financial Fraud Enforcement Task Force. The task force works 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.

Courtesy FBI

David Saks

Time&Temp Memphis

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Comment balloon 0 commentsDavid Saks • May 25 2011 07:59PM


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