Such a classic fraud - find someone with no morals down on his luck who serves as the straw man, buying up houses for prices waaaaaaaaaaaayyy beyond what they're worth.
The sellers are in on the deal, giving most of the extra proceeds to the corrupt syndicate, which includes the mortgage broker, the appraiser and the buyer. The buyer (after getting a suitcase of cash) then declares bankruptcy, which they were going to do anyway, and nobody knows any better.
Well, HP knows. Unfortunately this naive reporter didn't even though he got close.
The straw man in this case was a popular St. Louis coach who was recently fired by his school (hmmm...), down on his luck and in need of a big score.
He'll be in jail soon, if HP'ers or the St. Louis Post Dispatch do the right thing.
I emailed the reporter, and you can email the FBI too here. HP is on the case.
They're a little slow in St. Louis, so cut the guy some slack, but it looks like LA/Phoenix-style mortgage fraud has spread nationwide based on this story, even if they don't know it (yet)...
Winning coach loses in real estate
Ten months ago, one of Missouri's most successful basketball coaches tried his hand at real estate.
Floyd Irons, the architect of a string of high school championships, bought three houses over five days in January. Total cost: About $1.5 million.But the purchases have puzzled real estate agents and neighbors alike.
Why did the homes cost so much? And how could a public school coach making $90,000 a year afford roughly $120,000 in yearly mortgage payments?
It turns out he can't. All three houses have gone into foreclosure.
Irons says the bank has taken them back. Two sit vacant. Weeds sprout, railings rust and leaves pile high. Residents of the third are preparing to be evicted but say they have no where to go. Irons initially said little to explain the spending spree and instead expressed outrage at the inquiry.
"I smell a rat," he said. "Somebody's trying to find something out that isn't there."
December 14, 2006
St. Louis Post Dispatch reporter stumbles onto classic mortgage fraud and doesn't realize it
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I just emailed the FBI the posting
I smell a rat.... Yeah, the rat took the cheese and got caught in the trap. Classic. lol.
That fraud was so obvious, why didn't the reporter just say it?
"I'm a big boy"
Yeah... "Your Honor, with the Court's permission, I would like to state that I am in fact a Big Boy and I am fully prepared to accept whatever Justice the Court is prepared to mete out."
Haa Haaa Haaaaaa Haaaaaaa Ha
Shouldn't take too long for the subpoena of the closing statements to show who got how much.
Reporters can't say someone is a fraud unless they have been charged with fraud or someone else calls them a fraud (which is borderline) - it's libel.
...but they should get out all the facts so the rest of us can say "WAIT A SECOND!"
It's easy to figure out how he bought the houses.
But how in the world does a HS teacher/coach earn $90K/year????
Cut that # in half and you'd be closer to the truth, in most states.
Maybe he sells nutritional supplements on the side or something.
FRAUD!
Screw him - I hope he does hard time UNLUBED!
The doubling of prices in St. Louis City in the past five years is based solely on fundamentals. Nothing to see here, move along folks.
How can I get in on a deal like this?
Hey Keith,
Check out this article up on CNN.com right now:
Scraping by on $150,000 a year
Take one guess as to what is the biggest drain on this couple's income.
Why did the homes cost so much? And how could a public school coach making $90,000 a year afford roughly $120,000 in yearly mortgage payments?
he makes 90 grand???? what am i doing wrong...........
Rocky Mountain Mortgage Fraud Fever
By Carola Von Hoffmannstahl-Solomonoff
Posted: December 11, 2006 11:03 pm
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District Attorney Scott Storey of Jefferson County, Colorado is one busy lawman. The local housing market is chock full of mortgage fraud varmints. One particularly pesky ring, operating for roughly 5 years, recruited hundreds of illegal immigrants to act as “straw buyers,” the lowest players in the mortgage fraud game. Ringmasters were mortgage brokers, realtors, and loan officers in local banks. Straw buyers were supplied with stolen identities, including drivers licenses, social security cards, and income tax returns. Some were given green cards of legal immigrants. What couldn’t be stolen was forged.
False docs in hand, straw buyers obtained mortgage loans they had no intention of paying. Some 300 single family homes in Jefferson County and the adjoining Denver area are known to have been involved. In 191 transactions every single qualifying document was fake. So far, 38% of the mortgage loans have gone into foreclosure. Millions of dollars have been lost.
Tuff luck for lenders? Not as much as you’d think. The mortgages were insured by the Federal Housing Administration (FHA), a sub agency of the U.S. Department Of Housing and Urban Development (HUD). Taxpayers picked up the bad. Expect them to pick up more. D.A. Scott Storey believes thousands of other properties were obtained by the same ring and that similar frauds are widespread in the Denver area. And in an August 24th Denver Post article, “FHA program key in surge of foreclosures,” a government source estimated that “20,000 illegal immigrants hold FHA mortgages in metro Denver alone.”
Several years back, a realtor in Jefferson County tipped HUD in Dee Cee to the mortgage fraud ring which was using illegal immigrants as straw buyers. But the frauds went on for another 2 years. According to HUD Deputy Assistant Secretary Jereon Brown, the size of the ring made it more than an “overnight case”.
http://tinyurl.com/y5tnff
"And how could a public school coach making $90,000 a year afford roughly $120,000 in yearly mortgage payments?"
Selling steroids to the school players?
Here in Cape Coral a local cop was arrested by the FEDs for (allegedly)defrauding Fannie Mae.
http://tinyurl.com/yfobu7
Excuse me officer, would you mind bending down and getting the soap?
How is Casey Serin still a free man?
Police Sting Nets 2 Men In 'Red-Hot Mortgage Fraud'
TAMPA - The FBI and local authorities arrested two people Wednesday during a sting at a local title agency, part of a "red-hot mortgage fraud scheme" playing out across the country.
The men were trying to obtain a fraudulent mortgage in Sekertekin's name on a home at 811 Golf Island Drive, Apollo Beach. The men wanted to inflate the recorded sales price of the house from $690,000 to $910,000. At closing, $210,000 was to be paid back to a company started last month by Sekertekin.
http://preview.tinyurl.com/y5znw9
St. Louis city homes have increased in price (as a percentage) quite a bit in the past five years. The asking prices appear to be a bargain for folks from places like Los Angeles or Chicago or New York but the percentage change in the prices has been dramatic. Anyway, the same school system that this guy worked for (St. Louis) is in shambles and the board here can't get a thing done. There is an ongoing cat fight between the board president and the superintendent and they seem to be sleepwalking toward having the State take it over soon. What a joke.
Smug Bastard
St Louis isn't the only town, I suspect this is nation wide. I am from
Portland, visiting family in CO, and
let me tell you the real estate market
in Portland stinks to high heaven.
Hmmmm, maybe the reporter heard this:
"I smell a rat," he said. "Somebody's trying to find something there that isn't out."
Just wanted to add a couple of thoughts:
1. The reason why the coach, Floyd Irons, WAS making $90,000/yr was that he had been in the school system for 25+ years, thank you St. Louis Teachers Union. To his credit he is a legend in high school basketball circles, having coach hundreds of boys that made it to Div. I colleges and even some that made it to the NBA. That being said it doesn't give him any reason to do the things he did, I just wanted to let people know.
2. The best quote in the article: "We're honest, hard-working people," Esson said. Classic non-denial, denial. It doesn't look anyone was accusing them of not being "honest, hard-working", just asking for clarification. It would be great to get the whole conversation. any guesses?
Meh, this sh!ts been going on in Missouri for over five years.
Simple. In St. Louis the highest pay a teacher can earn is $83,000 a year. That is with a Phd so unlikely the coach had one. With a Masters the higherst is $77,000 a year. Teachers also have 3 months off in the summer and in 3 months can make an extra $13,000. So $90K....doable for a teacher.
"And how could a public school coach making $90,000 a year afford roughly $120,000 in yearly mortgage payments?"
I assume that very few people looking a this are from St. Louis, well I am and this is nothing. The entire South side and a lot of the North side of the city are full of this. I would say 50% if not 80% of the sales in these areas are flips, inflated apprasials or done with "seller credits" and other nonsense. The Feds just shut down several title companies, none were mentioned as being participants is these type of deals, but most of them were. No money down, forged documents, altered chains of titles (to not show the flips), cash pay offs to title people and even loan officers, you name it. You may wonder, "How do I know so much about it?", I have been a contractor in these areas for 10 years and I will say it is completely out of control. There was a company hear who, owned the appaisal company, the title company, the mortgage company and was the realtor and believe it or not, they got away with it for years. Then, they sold several vacant lots to themselves for $100,000, that might have been worth $300 and got caught. That scenario didn't even put a small dent in the game. I have seen, and still do see, many cases of 2 properties sitting right next to each other, one listed for $60,000 and the othe for $130,000, in the same condition at best. There are several players here and they still active. One of them going as far as flipping properties to themselves and back again and again via multiple LLC of family members. I know becasue they all owe me money or have bounced me checks. I don't think we are a little slow here, I just don't think people are paying attention because of the relative low amounts involved, $130-$140,000 or less, you do that 10 times a month for 10 years, it's a lot of money.
Dirtbags, all of them. I would most certainly like to name names and I will when the time is right.
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