FBI: “Former Mortgage Broker Indicted for Defrauding First Coweta Bank”

July 19, 2013

The Federal Bureau of Investigation (FBI) on July 18, 2013 released the following:

“GAINESVILLE, GA— Amy B. Williams, 48, of Buford, Georgia, has been indicted by a federal grand jury on charges arising out of a scheme to defraud First Coweta Bank.

“Bank fraud is a critical problem throughout the United States, but it has hit Georgia especially hard,” said United States Attorney Sally Quillian Yates. “Georgia leads the nation in bank failures since 2008, with 78 banks failing—including First Coweta Bank, the bank this defendant is charged with defrauding.”

According to United States Attorney Yates, the indictment, and other information presented in court: Williams was the sole owner of United International Mortgage (UIM) Corporation in Buford, Georgia, and was in the business of arranging construction loans for residential builders.

In April 2007, UIM closed three construction loans for one of its customers, Mainstreet Builders Inc. The loans were intended to finance the cost of constructing three new houses in Suwanee, Georgia. The loans, which totaled more than $1.7 million, were funded by First Coweta Bank.

Williams directed an unindicted co-conspirator to forge signatures on loan documents and caused those documents to be faxed to First Coweta Bank. The bank then wire transferred the loan proceeds to an account controlled by Williams. Williams was required to hold the money in trust for the builder and to disburse the money to the builder on a draw basis, as work on the three houses progressed. Instead, she used more than $1.1 million of this money to pay off her personal debt at another bank and wire transferred $60,000 into her personal checking account. After converting First Coweta Bank’s money to her own use, Williams attempted to cover up her crime by e-mailing false documents and misleading photos to the bank.

Mark F. Giuliano, Special Agent in Charge, FBI Atlanta Field Office, stated, “The actions of Ms. Williams, as alleged in the indictment, directly led to the failure of the First Coweta Bank and, as such, clearly demonstrates the serious nature and impact of those actions. The FBI will continue to coordinate its bank fraud investigations with its various law enforcement partners in an effort to effectively identify, investigate, and present for prosecution those individuals who do so much harm to the banking industry.”

Jason T. Moran, Special Agent in Charge, Federal Deposit Insurance Corporation-Office of Inspector General Southeast Region, said, “The Federal Deposit Insurance Corporation is committed to its partnerships with others in the law enforcement community as we address mortgage fraud and bank fraud cases throughout the country. The American people need to be assured that their government is working to ensure integrity in the financial services and housing industries and that those involved in criminal activities that undermine that integrity will be held accountable.”

Williams was arraigned today before United States Magistrate Judge J. Clay Fuller in Gainesville, Georgia.

The indictment charges one count of conspiracy and six counts of bank fraud. Each count carries a maximum sentence of 30 years in prison and a fine of up to $1,000,000. In determining the actual sentence, the court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.

Members of the public are reminded that the indictment contains only allegations. A defendant is presumed innocent of the charges, and it will be the government’s burden to prove a defendant’s guilt beyond a reasonable doubt at trial.

This case is being investigated by special agents of the FBI and the FDIC Office of Inspector General.

Assistant United States Attorney Russell Phillips is prosecuting the case.”

Federal Bank Fraud Crimes – 18 U.S.C. § 1344

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Prosecutors Say Mortgage Fraud Epidemic Highest In Northern California

October 10, 2012

CBS Sacramento on October 9, 2012 released the following:

“Reporting Nick Janes

SACRAMENTO (CBS13) – Federal investigators say scammers have been targeting families on the brink of losing their homes.

As prosecutors put it, we’re talking about a tidal wave of crime against vulnerable homeowners. In our area alone, the cases involve thousands of alleged victims and losses exceeding $9 million.

“The sheer impact of foreclosures and the fraud it’s generated in our communities is simply devastating,” FBI Special Agent Herb Brown said.

Prosecutors say foreclosure fraud could be more prevalent in Northern California than anywhere else.

“More defendants were charged with federal mortgage fraud crimes in this district than any other district in the country,” said Benjamin Wagner, the U.S. Attorney for the Eastern District.

That’s saying something when you see the staggering numbers released Tuesday from the year-long “distressed homeowner initiative.” Multiple federal agencies combined efforts.

Nationwide, 530 defendants are charged for alleged schemes involving 73,000 victims defrauded out of more than $1 billion.

“Behind the numbers there are true stories and true victims. They can be your neighbors, they can be your family members, they can be your co-workers,” Brown said.

Locally, one scheme promised to reduce home loans by 75 percent. A Roseville duo is accused of targeting Spanish speakers with TV and radio ads. A statewide scam promised to find investors to buy mortgages at discounts.

The common theme: all demanded money up front but never delivered. Prosecutors promise their crackdown is far from over.

“More investigations are under way and we expect that more prosecutions will arise as a result of the initiative that was started in the past year,” Wagner said.

Unfortunately, as is the case in most fraud cases, even after conviction prosecutors say the chance of victims getting their money back is very small.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Attorney Among Four Defendants Indicted in Alleged $16.2 Million Mortgage Fraud Scheme Involving at Least 35 Residential Loans

June 5, 2012

The Federal Bureau of Investigation (FBI) on June 4, 2012 released the following:

“CHICAGO— Four defendants—an attorney, a loan originator, a mortgage broker, and a loan processor—were indicted for allegedly participating in a scheme to fraudulently obtain at least 35 mortgage loans totaling more than $16.2 million from various lenders, federal law enforcement officials announced today. The indictment alleges that the mortgages were obtained to finance the purchase of properties throughout Chicago and in suburban Country Club Hills by buyers who were fraudulently qualified for loans, while the defendants allegedly profited from fees they were paid and undisclosed payments they obtained.

All four defendants were charged with various counts of mail fraud and bank fraud in a nine-count indictment that was returned by a federal grand jury last Thursday. The indictment also seeks forfeiture of $16,218,050. The charges were announced today by Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois; Robert D. Grant, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation; and Thomas P. Brady, Inspector in Charge of the U.S. Postal Inspection Service in Chicago.

Hakeem Rashid—39, of Miami and formerly of the Chicago area, a licensed loan originator who was employed by two mortgage brokerage companies, including 1st Regent Mortgage Funding Inc.—was charged with four counts of mail fraud and five counts of bank fraud. Kareem Broughton, 39, of Chicago, a mortgage broker and the owner of 1st Regent, was charged with two counts of mail fraud and three counts of bank fraud. Marguerite Elise Dixon-Roper, also known as “Elise Dixon,” 46, of Darien, an attorney, was charged with one count of mail fraud and two counts of bank fraud; and Jada Elaine Lucas, aka “Sophia Youssef,” 52, of Chicago, a loan processor at 1st Regent and another brokerage, was charged with three counts of mail fraud and one count of bank fraud.

An arrest warrant was issued for Rashid. The other three defendants are scheduled to be arraigned at 9:30 a.m. Thursday before Magistrate Judge Geraldine Soat Brown in U.S. District Court.

Between 2005 and May 2008, all four defendants and others allegedly schemed to obtain the fraudulent mortgages by making false representations in loan applications, supporting documents, and HUD-1 settlement statements concerning the buyers’ income, employment, financial condition, source of down payments, and intention to occupy the property.

As part of the scheme, Rashid, Broughton, and Dixon-Roper allegedly recruited buyers to purchase properties and facilitated the buyers’ purchase of properties, knowing that they would be fraudulently qualified for mortgage loans. Rashid and Broughton allegedly paid buyers for purchasing properties, while concealing the payments from lenders. In addition, the defendants also allegedly either purchased properties, which were mostly scattered throughout the city, and/or refinanced existing mortgages in their own names, knowing that they were fraudulently qualified for the loans.

According to the indictment, Broughton received payment through 1st Regent in the form of brokerage fees on loans for buyers whom he knew were qualified based on false information submitted to lenders; Rashid received payment through 1st Regent and another company for originating mortgage loans for buyers whom he knew were not qualified; Dixon-Roper received payment for representing buyers and sellers at real estate closings, knowing that the buyers were not legitimately qualified borrowers; and Youssef received payment for processing loans through 1st Regent, knowing that she submitted false information to qualify buyers for the loans.

In addition, Rashid, Broughton, and Dixon-Roper allegedly obtained undisclosed payments through entities they controlled, including The Broughton Group, R&B Management, Hamaya Banco, and Dixon-Roper’s law firm. Rashid and Dixon also allegedly submitted false statements to lenders indicating that escrow money was being held by Dixon-Roper or her law firm. Instead, knowing that no escrow money was being held, Dixon directed the payment of money purportedly held in escrow to herself and Rashid, while concealing the true nature of the payments from lenders, the charges allege.

The government is being represented by Assistant U.S. Attorneys Stephanie Zimdahl and Erika Csicsila.

Each count of bank fraud carries a maximum penalty of 30 years in prison and a $1 million fine, and each count of mail fraud carries a maximum of 20 years in prison and a $250,000 fine, and restitution is mandatory. If convicted, the court may impose an alternate fine totaling twice the loss to any victim or twice the gain to the defendant, whichever is greater. The court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.

The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

The charges are part of a continuing effort to investigate and prosecute mortgage fraud in northern Illinois and nationwide under the umbrella of the interagency Financial Fraud Enforcement Task Force, which was established to lead an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes.

Since 2008, close to 200 defendants have been charged in federal court in Chicago and Rockford with engaging in various mortgage fraud schemes involving more than 1,000 properties and more than $280 million in potential losses, signifying the high priority that federal law enforcement officials give mortgage fraud in an effort to deter others from engaging in crimes relating to residential and commercial real estate.

The Financial Fraud Enforcement Task Force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit: http://www.stopfraud.gov.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Ex-CFO at Taylor Bean and Whitaker Pleads Guilty in a $3B Fraud Scheme

March 21, 2012

Boston Globe March 20, 2012 released the following:

“Ex-exec at Taylor Bean pleads guilty in $3B fraud

By Matthew Barakat
AP Business Writer

ALEXANDRIA, Va.—The chief financial officer of what had been one of the nation’s largest private mortgage companies pleaded guilty to charges Tuesday for his role in a $3 billion fraud scheme.

Delton de Armas, 41, of Carrollton, Tex., was CFO of Florida-based Taylor Bean and Whitaker up until its collapse in 2009.

On Tuesday de Armas became the eighth person convicted in one of the biggest fraud schemes to emerge from the nation’s housing crisis. The other seven, including Taylor Bean founder and chairman Lee Farkas, were sentenced last year, with Farkas receiving a 30-year term.

De Armas faces up to 10 years after pleading in U.S. District Court to conspiracy to commit fraud and making false statements.

The company hid billions of dollars in debts with phony accounting and by double- and triple-selling mortgages it held to various financial institutions.

Taylor Bean’s collapse threw its 2,000 employees out of work and also helped bring down Alabama-based Colonial Bank, the sixth-largest bank failure in U.S. history.

At Tuesday’s plea hearing, de Armas first tried to tell the judge that he only became aware of the fraud at the very end of the scheme, but under questioning from U.S. District Judge Leonie Brinkema, he acknowledged that he knowingly signed off on misleading financial statements back to 2006.

Between 2006 and 2009, the “hole” in Taylor Bean’s books for a subsidiary called Ocala Funding grew from $150 million to more than $1 billion.

Regarding the company’s financial statements, de Armas told the judge: “Hindsight has the benefit of clarity. … I regret that I didn’t speak up more.”

He declined comment after Tuesday’s hearing.

Neil MacBride, U.S. Attorney for the Eastern District of Virginia, whose office prosecuted the case, said de Armas could have put a stop to the fraud the moment he discovered it.

“Instead, the hole in Ocala Funding grew to $1.5 billion on his watch, and as it grew, so did his lies to investors and the government,” MacBride added.

While the housing crisis apparently peaked a couple of years ago, prosecutors continue to bring a large number of mortgage fraud cases, with the Taylor Bean case among the most prominent. The FBI says that nearly 1,100 individuals were convicted of mortgage fraud in fiscal 2011 alone.

“The actions of Mr. de Armas and his co-conspirators contributed to the financial crisis and led to the collapse of one of the country’s largest commercial banks. The FBI and our partners remain vigilant in investigating such fraudulent activity in our banking and mortgage industries,” said James McJunkin, assistant director in charge of the FBI’s Washington Field Office.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Federal Indictment

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.