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11 people arrested for mortgage fraud in New Jersey

Federal authorities recently made 11 arrests in connection with what they claim was $15 million mortgage fraud scheme that spanned three states and included the attempted murder of a witness. The defendants, most of whom are from New Jersey, face charges of conspiracy to commit wire fraud and conspiracy to commit money laundering. One of the suspects also faces an attempted murder charge.

Serious allegations such as these require a strong criminal defense. The U.S. attorney's office is intent on rooting out large-scale white collar crime. In this case, the fraud charge and the money laundering charge carry potential maximum sentences of 30 years and 10 years, respectively. The attempted murder charge could mean up to 30 years in prison as well.

According to the indictment, the defendants collaborated to fraudulently inflate the sales price of overbuilt condominiums that were bought from desperate developers at rock-bottom prices. In order to convince buyers of the veracity of the inflated values, the defendants allegedly enlisted the help of straw buyers, who had good credit scores but lacked the capital to purchase units at the inflated price. In order to secure loans for these straw buyers, the defendants supposedly forged W-2s, pay stubs and bank statements to make them seem creditworthy.

Authorities claim the suspects also falsified sales contracts to conceal the true value of the condominiums. Thus, the potential buyers would see ostensibly valid real estate being bought into by seemingly creditable investors.

According to the indictment, when problems arose with one of the straw buyers, one of the defendants hired another man to kill the buyer. The straw buyer was allegedly led into the woods, where the hired hand shot him repeatedly with the defendant's gun. The straw buyer survived.

All 11 defendants are currently being held in federal custody. It remains to be seen whether all of the charges against them hold up in court.

Source: loansafe.org, "11 Charged in NJ, Arrests Made in $15M Mortgage Fund Scheme," Evan Bedard, July 24, 2012

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