Feds charge 14 Long Islanders over $58M mortgage fraud scheme

TRD New York /
Aug.August 04, 2011 03:13 PM

Manhattan U.S. Attorney Preet Bharara has announced charges against 14 defendants in a $58 million mortgage fraud scheme involving Long Island-based mortgage broker First Class Equities.

Bharara’s office filed a five-count indictment against Gerard Canino, the owner and president of First Class, five of the company’s loan officers, four attorneys with links to the company and one disbarred lawyer, all for their part in a mortgage fraud scheme involving 100 home mortgage loans.

“This brazen and wide-ranging scheme defrauded banks and lenders of millions and enriched its participants, including real estate professionals who took advantage of their inside knowledge of the system to fleece it,” Bharara said.

According to court filings, First Class Equities conspirators arranged home sales between “straw buyers” — people who had no genuine interest in buying the property. In one case, a defendant was paid $300,000 to act as a straw buyer to obtain 10 separate mortgages in 2006. First Class Equities loan officers then obtained mortgage loans for the sham deals by submitting fraudulent applications.

In addition to their roles in the scheme, two of the 14 defendants are also charged with making false statements to the FBI write out fbi in first reference.

“Their purpose wasn’t to assist homebuyers,” Janice Fedarcyk, FBI assistant director-in-charge, said in a statement. “It was a thinly-veiled multimillion-dollar bank fraud scheme.” — Katherine Clarke


Related Articles

arrow_forward_ios
Paul Manafort and Manhattan district attorney Cyrus Vance, Jr. (Getty)

Manafort mortgage-fraud case dismissed, again

Manafort mortgage-fraud case dismissed, again
Letitia James (Credit: Timothy A. Clary/AFP via Getty Images, iStock, Pixabay)

Real estate was among top consumer gripes in 2019

Real estate was among top consumer gripes in 2019
From left: 1578 Union Street in Brooklyn, Daniel Melamed (inset) and Eric Schneiderman (Credit: Google Maps, Getty Images, Facebook)

Overzealous investigators went too far in pursuit of Brooklyn landlord, appellate court rules

Overzealous investigators went too far in pursuit of Brooklyn landlord, appellate court rules
Paul Manafort and Manhattan District Attorney Cyrus Vance Jr. (Credit: Getty Images)

Judge tosses mortgage-fraud case against Manafort

Judge tosses mortgage-fraud case against Manafort
Florida man sentenced in $3.5M mortgage fraud scheme that targeted Orthodox Jewish community

Florida man sentenced in $3.5M mortgage fraud scheme that targeted Orthodox Jewish community

Florida man sentenced in $3.5M mortgage fraud scheme that targeted Orthodox Jewish community
Penny Bradley (Credit: Getty Images)

Upper East Side developer funded “lavish lifestyle” through mortgage fraud: Manhattan district attorney

Upper East Side developer funded “lavish lifestyle” through mortgage fraud: Manhattan district attorney
Morgan Management's Robert C. Morgan and the Avon Commons apartment complex in Avon, N.Y. (Credit: Rochester Institute of Technology)

Lenders poised to take over apartment empire amid massive mortgage fraud probe

Lenders poised to take over apartment empire amid massive mortgage fraud probe
How a New York mortgage broker scammed large banks and Fannie and Freddie

How a New York mortgage broker scammed large banks and Fannie and Freddie

How a New York mortgage broker scammed large banks and Fannie and Freddie
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...