Unlicensed Mortgage Broker Pleads Guilty To Siphoning $ 4.74 Million In Refi Proceeds

An unlicensed mortgage broker faces up to 30 years in prison after pleading guilty to a fraud scheme in which $ 4.74 million in mortgage refinancing proceeds was transferred to accounts controlled by the perpetrators.

The scheme left the victims with two mortgages on their homes, and several were eventually foreclosed. Home Point Financial Corp., LoanDepot, United Wholesale Mortgage and other wholesale mortgage lenders ultimately lost $ 2.47 million under the program, according to criminal information filed by prosecutors.

Brent Kaufman, 50, of Commack, New York, pleaded guilty on Aug. 31 at the Federal Courthouse in Brooklyn, to a scheme that authorities said was active from about 2016 to 2019. Kaufman worked as a brokerage firm in Brooklyn. unlicensed mortgages, “and has often helped clients in Queens and Long Island with refinancing their mortgages,” prosecutors said.

Kaufman and others not named in the lawsuit allegedly implemented the scheme by providing incorrect wire routing information to refinance lenders. Instead of sending funds to the financial institutions holding the mortgages to be refinanced, the refinancing lenders sent the money to accounts controlled by Kaufman.

So the original mortgages were not paid off immediately, although Kaufman used some of the proceeds to continue making monthly payments or possibly pay them off “to avoid detection of his scheme,” prosecutors said.

“Not only did Kaufman steal money from his victims, he also violated their trust, leaving them financially vulnerable and at risk of significant financial complications,” FBI Deputy Director Michael J. Driscoll said in a statement. communicated.

In addition to the FBI field office in New York, investigators included the Federal Housing Finance Agency, the Office of the Inspector General (FHFA-OIG), and the United States Postal Inspection Service, New York Division. York (USPIS).

The case is being pursued by the United States Attorney’s Office for the Eastern District of New York, which covers Brooklyn, Queens and Staten Island, as well as Nassau and Suffolk counties. In addition to a potential jail term, Kaufman faces a fine of up to $ 1 million when convicted and forfeiture of any ill-gotten gains, prosecutors said.

During the second quarter of 2021, the CoreLogic National Mortgage Application Fraud Risk Index increased 37.2% from a year ago, to reach 132. At the height of the pandemic refinancing boom, the index was fell to 96 “due to inflow of low risk funds. Term rate / refinancing. The rise to 132 for the second quarter of 2021 is in the historically high end of the index, but not very worrying, ”due to the shift in volume towards riskier purchase loans, CoreLogic reported.

The New York-Newark-Jersey City metropolitan area had the sixth highest risk of mortgage fraud in the second quarter of 2021. Of the top 15 markets with the highest risk of fraud, six were in Florida.

Top 15 Markets at Highest Risk for Mortgage Fraud

  1. Las Vegas-Henderson-Paradise, Nevada (251)
  2. Miami-Fort Lauderdale-Pompano Beach, Florida (235)
  3. Poughkeepsie-Newburgh-Middletown, New York (206)
  4. Tampa-St. Petersburg-Clearwater, Florida (191)
  5. San Jose-Sunnyvale-Santa Clara, California (189)
  6. New York-Newark-Jersey City, NY-NJ-Penn. (186)
  7. Orlando-Kissimmee-Sanford, Florida (180)
  8. Cape Coral-Fort Myers, Florida (180)
  9. North Port-Sarasota-Bradenton, Florida (178)
  10. LA-Long Beach-Anaheim, CA (176)
  11. San Francisco-Oakland-Berkeley, California (171)
  12. McAllen-Edinburg-Mission, Texas (169)
  13. Columbia, South Carolina (166)
  14. Bridgeport-Stamford-Norwalk, Connecticut (160)
  15. Lakeland-Winter Haven, Florida (158)

Source: CoreLogic

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