Crotty Saland PC a top white collar criminal defense firm, has learned that the Manhattan District Attorney’s Office has announced the indictment of thirteen individuals and a mortgage company in connection to a mortgage fraud scheme allegedly perpetrated in the New York City region over the past four years. Charged with Enterprise Corruption (PL 460.20), Grand Larceny in the First and Second Degrees (PL 155.42 and PL 155.40), Scheme to Defraud in the First Degree (PL 190.65) and Conspiracy in the Fifth Degree (PL 105.05), it is alleged that:
AFG Financial Group, Eugene Culbreath, Eric Shields, Matthew McDermott, Marc Zirogiannis, Kenneth Law, Kathleen Scanlon, Jeffrey Phelan, Jerry Strklja, Marilyn Mateo, Darlita Bostic, Allyson Hinds, and Rajmohan Autar, in varying roles, “…located distressed residential real estate properties in New York City and surrounding counties. They then engaged in a fraudulent scheme to steal millions of dollars from lending banks in Manhattan and elsewhere using sham sales of those properties. The conspirators caused the banks to front millions of dollars to finance purchases of the properties. They then walked away with most of the cash, leaving behind over-valued properties and worthless mortgage papers.” The Manhattan District Attorney’s Office further claims that recruiters found straw buyers who would be paid to enter into a real estate transaction where they were informed that the true homeowner would benefit from they service. Moreover, the straw buyers were told they would receive further compensation. After the mortgages and transactions were completed, the straw buyers did not receive any compensation and were left with possession of the mortgages which they could not pay. As a result, not only did the straw buyers lose money, but their credit went drastically south.
Not only is it alleged that fraudulent mortgage documents, falsified W2s and and inflated appraisals were created to perpetrate this crime, but is is further claimed by the Manhattan District Attorney’s Office that lawyers for AFG Financial Group would, among other things, be present at closings in order to make sure the scheme ran smoothly.
In total, it is believed that the sum of the mortgage scheme was in the neighborhood of one hundred million dollars.
If convicted of Grand Larceny in the First Degree or Enterprise Corruption, the defendants face up to 8 and 1/3 to 25 years in prison. Grand Larceny in the Second Degree carries a sentence of up to 5 to 15 years in prison and Scheme to Defraud in the First Degree has a potential term of imprisonment of 1 and 1/3 to 4 years in prison. Conspiracy in the Fifth Degree is a misdemeanor punishable by up to 1 year on Riker’s Island.
As a former Manhattan prosecutor who served under Robert Morgenthau supervising multi-million dollar fraud schemes and as white collar criminal defense attorney who has successfully represented clients in Manhattan for alleged million dollar theft schemes, I must say that these defendants need to act quickly to ascertain and implement their strongest defense. I have mentioned in the past that Investigation Division Central, the bureau handling this case, consists of prosecutors who are not merely aggressive in their pursuit of criminal activity, but made up of individuals who are thorough in that pursuit. Delays on the part of the defendants could be costly.
If you or a loved one is the target of an investigation, under arrest or facing and indictment, contact the white collar criminal defense attorneys at Crotty Saland PC so you can put forth your best defense to preserve your rights, liberty and integrity.