Can you imagine claiming that you and your family are destitute and even homeless and at the same time claiming that you are wealthy and getting millions in mortgages?  That is exactly what 15 people are accused of.  In fact, 12 of them were members of the same family.  Today the U.S. attorney in Manhattan, Preet Bharara, charged these 15, including a lawyer and appraiser with defrauding banks of $20 million over the last 10 ye ars while at the same time collection Medicaid and food stamps.  Although this is an unusually brazen example of mortgage fraud, it is hardly the only recent example.  Other examples include:

 Steve Weinstock, a Long Island attorney that was arrested for allegedly stealing $720,000 from his escrow account.  In addition he sold a property owned by his law firm and then kept the money for his personal use.

Andrew Daniel, 48, of Brentwood, NY who posed as a real estate agent and was arrested for allegedly stealing nearly $200,000 in down payments on properties.  In this case Mr. Daniel claimed to have negotiated the sale of 49 distressed properties to an investor in Queens, NY.  As it turns out, many of the properties were not distressed and the down payments were deposited into his personal account.

Mohammed Rafikian, 54 from Queens, N.Y. was recently sentenced to 16 to 50 years in prison for stealing $5,000,000.  Among the frauds that Mr. Rafikian committed was falsely posing as an attorney.  He stole from a cardiologist, a dentist, a bar manager, a retired disabled elevator mechanic, a NYCHA inspector, a painting contractor, and even a family friend.

Melanie Ferreira, 62 year from Lagrangeville, New York was recently sentenced to 51 months in prison for a series of frauds.  Among the frauds that she committed were paying off the mortgage on her Dutchess County home with a forged cashier’s check.  Later when the bank found out about the forged check, she then tried to pay off the same mortgage with a check on a closed account.  She also repeatedly filed false tax returns and requested large refunds.  After receiving a tax refund of $440,924 the IRS caught on to the fraud.

Darrell Beatty, 49 year from Queens, New York has been charged with literally stealing a house from an elderly woman.  Mr. Beatty, realizing that the house was not lived in, allegedly created a bogus deed to the house and recorded it.  He then moved into the vacant house.  The victim became suspicious when she noticed that the water bill, which was being mailed to her residence, was larger than usual.

Michael Rory Woods, 44, from Buffalo, who worked as a mortgage broker, is charged with allegedly inflating the income of James P. Vasiliou, Jr. in an application to refinance his mortgage.  By the way, Mr. Vasiliou had previously pleaded guilty to bank fraud in connection with making a false statement on a prior mortgage application.  In this matter, the alleged actions of Mr. Woods caused the approval of the refinance application and resulted in a loss to JP Morgan Chase, which held the mortgage.

Although these examples of mortgage fraud all took place in New York, mortgage fraud occurs throughout the U.S.  In my opinion, this is a crime that hasn’t been taken seriously enough in the past.  In fact you can even say that such crimes contributed to the financial crisis of 2007 – 2008.  Hopefully, we as a society have learned from our recent history and will now enforce the law.