Hey Tony, have you seen this one?

[apatriot]

FBI Arrests Hundreds In Mortgage Fraud Case
Losses Total About $1 Billion
POSTED: 9:10 am CDT June 19, 2008
UPDATED: 12:53 pm CDT June 19, 2008


The FBI said Thursday that it has arrested more than 400 real estate brokers since March -- including dozens over the last two days -- in its crackdown on incidents of mortgage fraud that have contributed to the country's housing crisis.

One law enforcement official put the losses to homeowners and other borrowers who were victims in the schemes at more than $1 billion.

The Justice Department and FBI announced the recent arrests at a news conference Thursday afternoon in Washington. Apprehensions were made in Chicago, Atlanta, Miami and suburban Maryland.

"Operation Malicious Mortgage" resulted in 144 mortgage fraud cases in which 406 defendants were charged. On Wednesday, 60 arrests were made in mortgage fraud-related cases in 15 districts. Charges were brought in every region of the United States and in more than 50 judicial districts by U.S. Attorneys' offices based upon the law enforcement and investigative efforts of participating law enforcement agencies.

"Mortgage fraud and related securities fraud pose a significant threat to our economy, to the stability of our nation's housing market and to the peace of mind of millions of American homeowners," said Deputy Attorney General Mark R. Filip. "'Operation Malicious Mortgage' and our other mortgage-related enforcement actions demonstrate the Justice Department's commitment and determination to combat these criminal schemes, hold their perpetrators accountable and help restore stability and confidence in our housing and credit markets."

FBI Director Robert Mueller said that the FBI will continue to direct resources to prosecuting mortgage fraud.

"This operation is an example of our unified commitment to address this significant crime problem," Mueller said. "The FBI will continue to direct investigative and analytic resources towards mortgage fraud and corporate securities fraud that threaten our nation's economy."

Also a part of the operation was the indictment of two former Bear Stearns managers in New York, becoming the first executives to face criminal charges related to the collapse of the subprime mortgage market.

Ralph Cioffi and Matthew Tannin, who have been the target of a probe by Brooklyn federal prosecutors, are suspected of misleading investors about the risky market.

Houston Arrests
A group of Houstonians are accused of defrauding banks and stealing $24 million in a fraudulent mortgage scam, KPRC-TV in Houston reported.

Six defendants are suspected of recruiting people with good credit to act as buyers in fraudulent mortgage deals, prosecutors said.

Federal agents began making arrests early Wednesday morning, delivering defendants to the federal courthouse who are alleged to have operated the massive mortgage fraud ring.
Officials said they were identified as mortgage loan officers or straw buyers who defrauded lenders of $24 million. The defendants were charged with conspiracy, fraud and money laundering.

Named in the indictment were Latasha Bellow, Frankthea Williams, Ishmael Laryea, Charles Joseph Deshawn Wilson, Kristen Way and Robert Stanley.
The indictment alleges phony buyers were recruited to apply for loans to buy pricey condominiums in Houston and surrounding suburbs. The loan applications allegedly used fraudulent information to obtain millions of dollars that the defendants then pocketed, the indictment said.

Attorney Ed O'Suji represents Williams.

"She's not guilty. She's been in real estate for the last five to six years. This is something she makes a living off of like any other real estate agent or broker," O'Suji said.

Williams and two other defendants made federal court appearances Wednesday. Their bond was set at $50,000. 

END

The link:  http://www.nbc5.com/money/16652452/detail.html?dl=mainclick

I could almost swear that somewhere here on BTF you said Real Estate Brokers had NOTHING to do with Mortgage Fraud or something like that.  Guess you were wrong on that one.

[apatriot]

Well, I think Tony saw this post cause I saw him logged in.  Geez, I hope he isn't hiding from this subject.  I didn't figure him to do that.

[Hogzilla]

I doubt it. He's not a lender. He's probably just not in the mood to get beat up on for others evil ways. The people involved in this should be hung by their shriveled little scrotums though.

[tony la]

I can't speak for a whole nation of Realtors.  But I will say that I will be suprised if any of this sticks to many Realtors.  We are pretty much at the crime scene just by being there at the time of sale.  If a fraudulant mortgage broker who is licensed by the state gives me a pre-approval affidavit signed off by him and his president.  An appraiser appraised the property.  A title company insured the title.  Two attorneys represented their clients.  I would say there is a lot involved.  They could easily be involved but no way by themselves.  

If a buyer produces a preapproval and wants to buy say, your home, at the price you are asking, are you going to say no I can't sell it to you because I think you are a straw buyer.  The Realtor is usually the last person to make that decision.  That loan had to go thru alot before it got to the Realtor.  Now if the Realtor was acting in a dual capacity say Mortgage Broker and Realtor it could happen.  If the Realtor had knowledge of this and it could be proved, then they should go to jail...period.  Of the millions or Realtors across America you are bound to find a bad one.  But you won't find one around me because I have no problem finding a rat and smashing them.  There is no room in this business for that.  I can't speak for Texas.  But in Illinois we are constantly under audit from the state, our board, and continuing education monitored by the state.  Their main purpose is to proactivly sniff out fraud.  

Many time the press gets Mortgage Broker and Real estate Broker mixed up.  Let's see what happens.  I have never had a problem with admiting I was wrong.  And if I am here I will admit it also.  I'm not a hide and seek kind of guy.  I'm like pop eye the sailor man.  What you see is what you get.  I am what I am.  

[tony la]

http://www.msnbc.msn.com/id/25251684/

After reading more.  It looks to me like they are Mortgage Brokers not Realtors.  They would have to be Mortgage Brokers to originate the loan.  But.......we will see.  It looks like her own lawyer got it wrong.

[Boris]

http://www.msnbc.msn.com/id/25251684/

After reading more.  It looks to me like they are Mortgage Brokers not Realtors.  They would have to be Mortgage Brokers to originate the loan.  But.......we will see.  It looks like her own lawyer got it wrong.

Hey Tony...don't sweat it. We got a big basement you can hide in, and nobody would think to look for you there because it's unfinished.

...and there's always Bonster's garage.

[apatriot]

Tony, the FBI doesn't play to lose and I will venture to guess the press made no mistake.  It's been all over the TV today.  They have had ample time to correct.

[OakParkSpartan]

Tony, the FBI doesn't play to loose and I will venture to guess the press made no mistake.  It's been all over the TV today.  They have had ample time to correct.

Why do you bring Tony into this?  So that you can try and dirty his name?

[ZORBA]

apat,

I'm not certain about this one, but my guess would be that there were a hell of a lot more MORTGAGE BROKERS involved than REAL ESTATE BROKERS. After all, the title of the operation is Malicious MORTGAGE.

Realtors may have aided and/or abetted the scams in some instances, but I would bet that most of the plots originated from and were spearheaded by MORTGAGE brokers.

[apatriot]

OP, it's his field of experience, and it was all over the news.  That's all.  Why would you say I want to dirty his name?

Silk, I just posted the article, that's all.  We all have to wait and see on the updates.

[tony la]

http://www.msnbc.msn.com/id/25251684/

After reading more.  It looks to me like they are Mortgage Brokers not Realtors.  They would have to be Mortgage Brokers to originate the loan.  But.......we will see.  It looks like her own lawyer got it wrong.

Hey Tony...don't sweat it. We got a big basement you can hide in, and nobody would think to look for you there because it's unfinished.

...and there's always Bonster's garage.

Thanks,  I may take you up on that.

[Hogzilla]

OP, it's his field of experience, and it was all over the news.  That's all.  Why would you say I want to dirty his name?

Silk, I just posted the article, that's all.  We all have to wait and see on the updates.

You came across as poking at him for a reaction based on this quote...

"Well, I think Tony saw this post cause I saw him logged in.  Geez, I hope he isn't hiding from this subject.  I didn't figure him to do that."

I really don't get the impression you were just wanting to chat about it and get an inside opinion on the matter. Seemed to be a bit of venom in it.

Alan Colmes

[apatriot]

Hog, don't try to figure what my intents are.  This story was splattered all over the news yesterday.  It's real estate.  Tony has a prominent spot here in the real estate arena.  I'm sure the whole topic is a black eye for the real estate industry, but it doesn't mean, and nowhere did I ever imply that Tony is part of anything like this.  Just was looking to see if he had any comments on it.  He usually jumps right in when real estate is the topic, and other topics too, but he seemed quiet on this one.  Perhaps he needed the time to read up and find out for himself what was going on. 

That said ... Venom?  Yes.  When you destroy families?  OF COURSE.  When you are helping to destory economy?  YES !!

After reading the info at the FBI website, which by the way, has an entire website devoted to mortgage fraud, they tell you that with these bad mortgage companies, the realtors are in bed with the mortgage companies.  The realtor brings the lamb to the slaughter.  Even Tony said they are at the scene of the crime.  Does that make them innocent as they are not the ones who actually do the slaughter, but bring them to the slaughter?  I suppose kickbacks from mortage company to realtor isn't out of the picture either.  I just know I could never sit there knowing that I brought a family to a closing to be destroyed down the line.

[Boris]

I don't think it's a black-eye for the real-estate industry. I think it's a black-eye and a broken knee cap for the banking industry.

[tony la]

apat,

I have never and will never avoid a subject on this board that has anything to do with real estate or me.  There are 1.2 million realtors in the U.S.  I have not met all of them yet, but I'm working on it.  I can tell you there are probably some bad apples there.  Just about anything that has 1.2 million members is going to have that problem.  Most of the press has gotten this mortgage crisis wrong from day one.  It is no suprise to me that even law enforcement has gotten some of this wrong.  I can tell you that I read the diciplines of the Department of Professional Regulation every month and I have never seen a realtor charged with any mortgage fraud in the state of Illinois.  It may happen but I have yet to see.  Again we are under constant checks and balances from our different board of Realtors, to our Brokers,  to the State,  and even or franchises to act in a ethical manor at all times.  We also carry what is called errors and omissions insurance.  So we are being watched from so many angles it kind of makes it tough to act illegally.  Again,  I am not saying it can't happen.  Anything can happen. 

For a realtor to take a kickback from a mortgage company is illeagle.  And any kickback that a mortgage company can give to a realtor is certainly not worth them loosing their license.  I am very anxcious to find these names of people to find where their license was held and in what capacity.  Of the  six that were charged I can tell you at least two of them had no license at all.  In reading further over 300 have been arrested in Texas.  And Nevada they say is ground zero.  Now it also looks like many of these sales  were done on new construction.  New construction in this state and many others including Nevada do not require the builder to have a licensed agent to sell the property.  Which would make it much easier to commit a crime.  In fact our own state did not require licensing of mortgage brokers until a few years ago. 

To complete these tasks you need an appraiser that is willing to falsify an appraisal.  Without that, this fraud does not happen. 

Apat, I have to tell you that this bothers me as much as it bothers you.   Nobody wins with this kind of garbage out there.  Of those 1.2 million realtors, over 50% of them have been selling for 5 years or less.  But I think the bottom line here is the majority of these frauds were started by a dirty appraiser.

[Bonster]

For a realtor to take a kickback from a mortgage company is illeagle.  And any kickback that a mortgage company can give to a realtor is certainly not worth them loosing their license. 

So is this legit?

http://www.berwyntalk.com/smf/index.php?topic=5464.0

[apatriot]

Tony, I believe you.

Bon, did you have in mind a particular post under that thread?

[tony la]

For a realtor to take a kickback from a mortgage company is illeagle.  And any kickback that a mortgage company can give to a realtor is certainly not worth them loosing their license. 

So is this legit?

http://www.berwyntalk.com/smf/index.php?topic=5464.0

I have only seen this on new construction condos and apartment buildings that have been turned into condos. However , I do not have all the answers on every program, but I know where to find the answer.  It is a legitimate program that is out there.   Again a underwriter has to sign off on these programs.  That underwriter is at the discretion of the appraiser for their information.  Then this loan is 99% of the time sold on the secondary market. 

[Shoops]

Like Tony said, every loan comes down to an underwriter who approves the loan. The problem can happen when a mortgage company may ask an appraiser to do what they can to increase a value on the appraisal, in order to justify the loan.

I'll bet many of those people who were arrested either falsified loan applications, appraisals or underwriters who turned a blinds eye in order to close a deal.

Bonster, that 6 Month with No Loan Payment is simply a loan that allows for a seller to give a credit to the buyer in order to pay the buyer's first 6 months of loan payments. The credit goes directly to the lender. There are more smaller details, but that's the basics of how it works. The buyer still has to come up with a minimum of a 5% downpayment.

Tony, talk to Phil. He has the details on that program.

[Terri]

Here's a link detailing the scheme and indictments of "Operation Malicious Mortgage".  Apat, none of the names are local.    

http://www.fraudblogger.com/CHICAGO67CHARGED061908.asp