LaFrances Dudley O’Neal and Donald M. Ramsey Indicted in an Alleged Mortgage Fraud Scheme

December 11, 2011

The Federal Bureau of Investigation (FBI) on December 9, 2011 released the following:

“Two Indicted in Mortgage Fraud Scheme

D.C. Housing Authority was Among Targets of the Scam

WASHINGTON— LaFrances Dudley O’Neal, 47, of Clinton, Maryland, and Donald M. Ramsey, 44, of Alexandria, Virginia, have been indicted on charges that they took part in a mortgage fraud that cost lenders more than $700,000.

The indictments, unsealed today, were announced by U.S. Attorney Ronald C. Machen Jr., Daniel S. Cortez, Inspector in Charge, Washington Division, U.S. Postal Inspection Service, Kenneth R. Taylor, Special Agent in Charge of the Office of Inspector General of the U.S. Department of Housing and Urban Development, and James W. McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office.

O’Neal and Ramsey were indicted on December 7, 2011 in the U.S. District Court for the District of Columbia on charges of bank fraud, mail fraud, and conspiracy to commit bank/mail fraud. The indictment also includes a forfeiture count seeking all proceeds from the defendants’ crimes. In addition, O’Neal was charged with one count of fraud under District of Columbia law. If convicted, under the federal sentencing guidelines, O’Neal and Ramsey face potential sentences of 37 to 46 months in prison. Both have pleaded not guilty to the charges.

According to the indictment, O’Neal, Ramsey and others identified homes in the Washington, D.C. area, as well as straw buyers to obtain mortgages through false loan applications, forged documents, and fraudulent settlements. According to the indictment, Ramsey acted as a mortgage broker. He and others are accused of providing false documentation to the lenders, such as false verifications of deposit, forged Uniform Residential Loan Applications, and false rental agreements, causing the lenders to believe that the straw buyers had the means and the willingness to pay the mortgages.

The indictment alleges that every one of the mortgages fell into default and the lenders were forced to foreclose, with an aggregate loss to the lenders in excess of $700,000.

The indictment further alleges that settlement companies paid both O’Neal and Ramsey money from the fraudulently obtained loan proceeds, at times using fraudulent “invoices” which falsely stated that renovation work had recently been completed or consulting services had been provided and that money was due at settlement. As a result of these false invoices and inaccurate settlement statements, settlement agents turned over more than $437,000 of fraudulent loan proceeds to O’Neal and Ramsey.

With respect to the fraud count under D.C. law, the indictment charges that O’Neal arranged for four of the houses, which were obtained through the mortgage fraud scheme, to be placed in the District of Columbia Housing Authority’s Section 8 Tenant-Based Assistance Housing Choice Voucher program. Using, at times, forged management agreements, O’Neal received money from the D.C. Housing Authority through Section 8 payments through her management company. She also received emergency rental payments or security deposits from charities or governmental agencies on behalf of the needy tenants.

However, she failed to maintain the Section 8 houses in decent, safe, and sanitary conditions, in spite of payments by the D.C. Housing Authority and the tenants. And, despite promising the straw buyers that she would pay the mortgages and even though she received Section 8 money from the D.C. Housing Authority and their client tenants, O’Neal failed to pay the mortgages on all four properties and the lenders foreclosed on them.

An indictment is merely a formal charge that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty.

The case was investigated by the U.S. Postal Inspection Service, the Office of the Inspector General of the U.S. Department of Housing and Urban Development, the FBI’s Washington Field Office, the Metropolitan Police Department, and the District of Columbia Department of Insurance Securities and Banking. It is being prosecuted by Assistant U.S. Attorney Virginia Cheatham, with assistance from the U.S. Attorney’s Office’s Asset Forfeiture and Money Laundering Section, paralegal specialist Sarah Reis, forensic accountant Crystal Boodoo, and legal assistant Krishawn Graham.”

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

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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 McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Assistant to U.S. Senator Indicted with Making Prohibited Communications

March 29, 2011

The former administrative assistant to a U.S. senator was charged today by a federal grand jury in the District of Columbia with violating criminal conflict of interest laws, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Ronald C. Machen of the District of Columbia; and James W. McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office.

The indictment charges Douglas Hampton, 48, formerly of Las Vegas, with seven counts of violating the criminal conflict of interest laws. Hampton will be arraigned on March 31, 2011, in U.S. District Court in the District of Columbia.

According to the indictment, from January 2007 to April 30, 2008, Hampton was employed as the administrative assistant to a U.S. senator. The administrative assistant and chief of staff positions were the most senior positions in the senator’s office. While he was serving as administrative assistant, Hampton allegedly signed a form certifying that he had completed training required by the Senate Select Committee on Ethics that included training on the one-year post-employment lobbying restrictions mandated by The Honest Leadership and Open Government Act of 2007.

The legislation was enacted by Congress for the purpose of providing greater transparency and accountability in both Houses by, among other things, slowing down the “revolving door” between congressional employment and post-employment lobbying activities. The legislation prohibits a senior Senate staffer, for a period of one year after termination of employment with the Senate, from knowingly making any communication to a Senate office with the intent to influence official actions on behalf of another person.

The indictment alleges that on May 1, 2008, Hampton left his employment with the U.S. senator and obtained employment as a government affairs consultant with an airline company and an energy company, both headquartered in Las Vegas.

Allegedly, between May 1, 2008, and May 1, 2009, while he was subject to The Honest Leadership and Open Government Act’s one-year restriction, Hampton made communications to staff members of the U.S. senator on behalf of the Las Vegas airline company and energy company, allegedly seeking action by the senator and the staff members in their official capacities.

The maximum penalty for each of the seven counts alleged in the indictment is five years in prison. Hampton also faces a maximum fine of $250,000 per count.

To view the FBI press release in its entirety, please click here.

Douglas McNabb and other members of the firm practice and write extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN List Removal.

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

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Former Staff Member Convicted on Corruption Charges

February 10, 2011

A federal jury in the District of Columbia today convicted a former staff member in the U.S. House of Representatives on corruption charges relating to his acceptance of an all-expenses paid trip to Game One of the 2003 World Series.

Fraser C. Verrusio, 41, was convicted after a 10-day trial on one count of conspiring to accept an illegal gratuity, one count of accepting an illegal gratuity and one count of making a false statement in failing to report his receipt of gifts from a lobbyist and the lobbyist’s client on his 2003 financial disclosure statement.

Verrusio worked as the policy director for the U.S. House of Representatives Committee on Transportation and Infrastructure. The committee had responsibility for, among other things, the Federal Highway Bill in the House of Representatives.

According to evidence and testimony presented at trial, Verrusio and Trevor Blackann, a legislative assistant to a U.S. Senator, accepted an all-expenses-paid trip to Game One of the 2003 World Series from a lobbyist working for an equipment rental company interested in inserting three amendments into the Federal Highway Bill. The trip was funded by the equipment rental company and the lobbyist’s firm. Evidence also established that one of the lobbyists who helped arrange for the trip worked with former lobbyist Jack Abramoff, and that the equipment rental company was a client at Abramoff’s firm.

At sentencing, scheduled for May 6, 2011, Verrusio faces a maximum penalty of five years in prison and a $250,000 fine on the conspiracy charge. He faces a maximum of two years in prison and a $250,000 fine on the illegal gratuity charge, and a maximum of five years in prison and a $250,000 fine on the false statement charge.

Blackann previously pleaded guilty for his role in the scheme. To date, 20 individuals, including lobbyists and public officials, have pleaded guilty or been convicted at trial in connection with the activities of Abramoff and his associates. Abramoff pleaded guilty in January 2006 to conspiracy to commit honest services fraud, honest services fraud and tax evasion. He was sentenced in September 2008 to 48 months in prison.

Those who have pleaded guilty most certainly agreed to cooperate with the government for a reduced sentence. As part of the substantial assistance, testifying against others is typically a requirement, which most likely occurred in Verrusio’s trial.

For a complete reading of the DOJ press release, please click here.

Douglas McNabb and other members of the firm practice and write extensively on matters involving Federal Criminal Defense, INTERPOL Litigation, International Extradition and OFAC SDN Litigation.

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

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41 Alleged Gang Members Charged in Five Judicial Districts

February 10, 2011

Forty-one members of various street gangs have been charged in indictments or criminal complaints unsealed today in five judicial districts, the Department of Justice announced yesterday.

The federal indictments and complaints unsealed today charge members and associates of a variety of street gangs, including: seven members of the Click Clack gang in Kansas City, Missouri; twelve Colonias Chiques gang members in Los Angeles; two members and associates of the Sureno 13 and San Chucos gangs in Las Vegas: seven MS-13 members in Washington; thirteen Tri-City Bomber members and associates in the McAllen, Texas, area.

The charges in these separate cases relate to a wide range of alleged illegal activity, including racketeering conspiracy, murder, murder conspiracy, narcotics trafficking, robbery, and gun trafficking. The individuals will make initial court appearances in the respective districts in which they are charged. Teams of federal, state, and local law enforcement officers have arrested 29 of these individuals, with additional arrests expected.

In the Washington indictment of MS-13 members (U.S. v. Carlos Silva, et al) the seven individuals added in the superseding indictment are charged with RICO conspiracy and other offenses including two murders, armed robbery, sexual abuse while armed, kidnapping, and obstructing justice. The indictment alleges that between 2008 and 2010, MS-13 members sent money to gang leaders in El Salvador, as well as participated in the stabbing of rival gang members and kidnapping, among other crimes.

The Houston indictment (U.S. v. Jeffrey Juarez, et al) of the Tri-City Bombers charges 13 individuals with conspiring to sell cocaine and ecstasy and with firearm-related offenses.

The DOJ is making very clear their efforts to address gangs and gang-related violence as one of their top priorities. This month alone, a total of 112 individuals have been arrested, charged, pleaded guilty, or been sentenced.

To view the DOJ press release in its entirety, please click here.

Douglas McNabb and other members of the firm practice and write extensively on matters involving Federal Criminal Defense, INTERPOL Litigation, International Extradition and OFAC SDN Litigation.

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

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Roger Clemens in Federal Court Regarding Attorney Conflict of Interest

February 3, 2011

Ex-New York Yankees pitcher Roger Clemens, accused of lying to Congress about steroid use, told a federal judge he won’t challenge a possible conviction on grounds involving his lawyers’ potential conflict of interest.

Clemens, responding to questions from U.S. District Judge Reggie Walton during a hearing yesterday in Washington, indicated he understood the ramifications of the potential conflict and waived his right to contest it. By agreeing, Clemens signaled that he wants to keep his current legal team.

Clemens was asked directly whether he is willing to waive any potential conflict of interest, to which he responded in the affirmative.

U.S. prosecutors requested the hearing, saying Clemens’ lead lawyer, Rusty Hardin, and his Houston-based law firm previously did work on behalf of Yankees pitcher Andy Pettitte. That work may bar Hardin and his firm from cross-examining Pettitte, a government witness, if the criminal case against Clemens proceeds to trial, prosecutors said.

Hardin said during the 20-minute hearing that a lawyer from another firm had been retained specifically to avoid any conflicts that might arise from the previous work for Pettitte.

Clemens, 48, was indicted in August on one count of obstructing a congressional investigation, three counts of making false statements and two counts of perjury. Clemens, who also played for the Boston Rex Sox, Toronto Blue Jays and Houston Astros over a 24-year Major League Baseball career, pleaded not guilty. He faces a $1.5 million fine and a maximum of 30 years in prison if convicted on all charges. Jury selection is scheduled to begin July 6.

The allegations of drug use were made by Brian McNamee, a former trainer to both Clemens and Pettitte.

In an interesting twist at the hearing, Judge Walton admitted that while he was visiting his hometown in Donora, Pennsylvania, a former Cincinnati Reds outfielder Ken Griffey Sr., who Walton said he “played ball with,” came up to him and asked the judge whether he was handling the Clemens case. Walton said he was and that Griffey responded, “He’s a good guy.” Walton said he told Griffey that he couldn’t talk about the case.

Walton asked whether either of the parties would object to him continuing to preside over the case because of the incident. Both Assistant U.S. Attorney Daniel Butler and the defense said they were fine with it. Therefore, both parties will not be able to raise a subsequent objection regarding the judge’s neutrality.

Clemens, in a January 21 filing, asked Walton to dismiss the charges, saying the indictment doesn’t explain how he allegedly obstructed a congressional investigation in 2008 when he denied using performance-enhancing drugs.

Walton has yet to rule on the motion to dismiss. At this point, it looks like Clemens is going to trial this summer, where a jury will determine his guilt or innocence.

Douglas McNabb and other members of the firm practice and write extensively on matters involving Federal Criminal Defense, Interpol Litigation, International Extradition and OFAC Litigation.

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

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