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South Florida

$50M Miami-based mortgage fraud scheme uncovered

Ten federal indictments were handed down over a $50 million mortgage fraud scheme based in Miami.

Hector Hernandez, owner of Great County Mortgage Bankers, was charged with wire fraud earlier this week. Seven of his employees were also indicted, along with developers Armando Bravo and Aleida Fontao.

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The defendants allegedly obtained fraudulent loans through the Federal Housing Administration between 2006 and 2008, according to the indictment, as cited by the South Florida Business Journal. Borrower income and financial statements were exaggerated so the applicants could qualify for the mortgages. Great County later sold the loans to financial institutions.

Because it guaranteed the mortgages, the FHA incurred more than $50 million in losses from the scam. [South Florida Business Journal] — Eric Kalis

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Fraud