June 19, 2008

FLASH: FBI arrests over 300 realtors and mortgage brokers in mortgage fraud sweep. FINALLY!!! And only another million or so to go...


And after they're done arresting the realtors and mortgage brokers, they can move on to the millions of mortgage fraudsters. I think Casey Serin might still be in the country.

And then... of course... they can put the kingpin himself into the paddy wagon..

Angelo Mozilo - they're coming to get you!

(UPDATE: New classic frog-march image from today's headline story on HuffPo. FBI release here. Frog-march video here)

Hundreds swept up in mortgage fraud arrests

WASHINGTON - The FBI says it has arrested about 300 real estate brokers since March — including dozens over the last two days — in its crackdown on incidents of mortgage fraud that have contributed to the country's housing crisis.

One law enforcement official put the losses to homeowners and other borrowers who were victims in the schemes at over $1 billion.

The Justice Department and FBI plan to announce the recent arrests — including apprehensions in Chicago, Atlanta, Miami, and suburban Maryland — at a news conference set for Thursday afternoon in Washington.

Two former Bear Stearns managers in New York were also included in the sweep, becoming the first executives to face criminal charges related to the collapse of the subprime mortgage market.

44 comments:

Batman said...

Did the Kingpins Paulson and Bernanke get away or are they still at large?

Batman said...

Canada finally getting around to rounding up mafiosi from the last bubble (dot com)

http://tinyurl.com/4xtx65

Holy terrible tip of the iceberg...

Anonymous said...

The Realtor mafia is finally being nailed. Lightweights for sure. Will they be "White Collar Criminals"? Or will they serve time with the brothers?

LibVet said...

A little joke from phun.org

http://tinyurl.com/3oejgw

Anonymous said...

Oh boy, you guys are going to love this. Realtors have become squatters:

Condo bust draws scams and squatters

Property managers at condos are coping with new schemes -- some criminal, others plain irritating -- arising from foreclosures.

Rice, 30, took over management of The Club in December, riding in like a sheriff to establish order in a building overrun with outlaws. She said the problems resulted from mortgage fraud that produced an explosion of absentee owners and sketchy tenants since the building opened in late 2004. The Club has more than 260 units in foreclosure.

After taking the job, she immediately deactivated 8,000 access cards for the building's 640 units, incurring the wrath of many residents. After forcing everyone to reapply, she whittled the number to 1,400. Several squatters have been evicted over the past six months because of strict new registration policies, Rice said.

''No one lives in my building for free,'' Rice said.

Realtor lock boxes, which contain keys, and neon eviction stickers from the county announce to everyone units are vacant, Direktor said.

Unlike the homeless in need of shelter or refugees displaced by natural disasters or war, it is not clear if this breed of freeloaders is as down on their luck.

Paola Arboleda, manager of the Mark Yacht Club on Brickell Bay, said two months ago residents noticed someone hopping among various vacant units. A little snooping revealed the interloper was a mortgage broker.

''We didn't know who he was paying or if he was paying,'' Arboleda said. ''Thank God, he's gone,'' Arboleda said. Since lenders have tightened underwriting standards and curbed fraud, the problem is easier to control, she said.

But most squatters aren't in the units to just hang their hats, Giordano said.

''They are probably involved in prostitution, burglary and other criminal activity,'' Giordano said. He suspects many cases are the work of an organized ring.

Ada Portillo recently fell victim to one new scheme. The single mother needed a short-term rental while awaiting delivery of her condo at Met I Miami. She posted an ad on Craigslist, got a quick reply, and ended up in a lovely new place at Loft 2 in downtown Miami. She paid the $3,150 for a three-month lease up-front. The BMW-driving con man even helped her move in.

''He was very nice,'' Portillo said.

Two weeks later, the real owner surfaced and evicted her. She was out the money. After a little detective work, Portillo found the swindler had stolen the identity of a Mexican pizza maker in New Jersey. Miami police support her story and are on the case.


http://tinyurl.com/3q3wft

Jeff in California said...

Every day such as this is a day of healing from psychological wound created during the 2001 - 2007 irrationality. Simply stated, I spent 7 years as a renter wondering WTF is going on as my neighbor (who plays the harp for a living) gained several hundred thousand dollars in equity in her house. And now it's time for "legitimate hard work" in America to be rewarded...and stories such as this reinforce my disposition towards our country. Keep em coming Keith, great work.

Frank@Scottsdale-Sucks.com said...

Our a/c crapped out. It turned out to be a very expensive repair. I'm sure glad I don't "own" this place.

Anonymous said...

Bailout bill to be passed today in the senate.

Sorry renters. You lose once again.

Enjoy the shithole 1 bed 1 bath and keep voting democrat.

Anonymous said...

Super job!!!

Horse has already left the barn. But is damn nice of you to close the door while it is burning to keep the horse from going back in.

We/The Economy/The country are all still F@#$ED

Anonymous said...

Did that include Casey?

-FutureShock-

Anonymous said...

This article from 2007 has MANY of your favorites mentioned in it!
http://money.cnn.com/2007/08/06/magazines/fsb/real_estate.fsb/index.htm?postversion=2007080706

It is so good I guess there is a chance you have linked to it before but just in case there it is. It is about a real estate "university"

Anonymous said...

Greg Swann is probably heading to Mexico

Anonymous said...

about f'ing time.

Anonymous said...

jeff in ca:
"Every day such as this is a day of healing from psychological wound created during the 2001 - 2007 irrationality."

A little too much free time, eh? You don't know a thing about psychological wounds. I'd hate to see you have a real problem.

JT said...

Was about to post a link here to this, but you beat me to it! Looks like its finally time to take out the trash.

Anonymous said...

Frank@Scottsdale-Sucks.com:

Funny, my a/c crapped out, too. It cost less than 3 grand to repair. That's what a maintenance budget is for. I'm sure glad my rent didn't go up because of it...ooops! I don't have a rent payment to watch go up.

Anonymous said...

gee... only 5 years too late. What has the FBI been doing for the past 5 years?

Anonymous said...

oh come on keith, are you going to go for this window dressing? its about time for the sheep to elect another puppet so lets make them think we are trying to help them. then you can watch the big fish just casually swim away....no problem. the useful idiots are rounded up, and we all think that someone actually cares.......they don't though......nobody does except you and i. the only thing that will ever change this is deadly force...

keith said...

Here's the news from the FBI:

http://www.fbi.gov/pressrel/pressrel08/mortgagefraud061908.htm

More Than 400 Defendants Charged for Roles in Mortgage Fraud
Schemes as Part of Operation "Malicious Mortgage"

Two Senior Managers of Failed Bear Stearns Hedge Funds Indicted
Today in Separate Mortgage-Related Securities Fraud Case

WASHINGTON – The Department of Justice and Federal Bureau of Investigation (FBI) announced today a national takedown of mortgage fraud schemes, the culmination of substantial coordinated efforts during the last three and a half months to identify, arrest and prosecute mortgage fraud violators through the United States. Operation Malicious Mortgage highlights the strong enforcement response undertaken by the Department of Justice and its law enforcement partners to combat the threat mortgage fraud poses to the U.S. housing industry and worldwide credit markets.

From March 1 to June 18, 2008, Operation Malicious Mortgage resulted in 144 mortgage fraud cases in which 406 defendants were charged. Yesterday, 60 arrests were made in mortgage fraud-related cases in 15 districts. Charges in Operation Malicious Mortgage cases were brought in every region of the United States and in more than 50 judicial districts by U.S. Attorneys’ Offices based upon the law enforcement and investigative efforts of participating law enforcement agencies. The FBI estimates that approximately $1 billion in losses were inflicted by the mortgage fraud schemes employed in these cases.

I Hate Frank said...

Hey Frank you friggen jerk! I thought you lived in Newport by the coast. Temp was only 76 with a nice off-shore breeze. My ass, you live in Newport. If you did, you would not need the a/c. I'll be seeing you on one of the off-ramps of the 55 real soon. When I do, I will be sure to throw a few rolls of pennies at your stupid ass.

You douche.

Lost Cause said...

Finally. You would think that the whole country was corrupt -- from the very top on down -- for the past eight years.

You would be right.

Lost Cause said...

The FBI estimates that approximately $1 billion in losses were inflicted by the mortgage fraud schemes employed in these cases.

I am guessing that the tune on the economy will be changing.

From "It's not our fault. Pay no attention to the oil prices -- an industry which we are embedded -- and the speculative fuel which we are pumping out faster than petro-dollars."

To "It's not our fault. It is the criminals which are are rounding up in the middle of the night and putting into camps."

Lost Cause said...

And now it's time for "legitimate hard work" in America to be rewarded...and stories such as this reinforce my disposition towards our country.

A disgusting fable for the working classes. Most of the money in this country is made on the golf course and at the country club. Get back to work, peon.

Anonymous said...

All on schedule!

edd said...

With enhanced interrogation,
we could convict millions, and
put them on pedal generators
for the power grid.

Or put them on chain gangs
to rehab derelict homes for
"Flip That House".

Anonymous said...

Have they picked up Dodd yet?

I own realtors said...

my broker was arrested in the sting.The sob cost me a deal and my deposit.I hope he takes it in the ass in jail.

Democraatus said...

Small fish only. It's enough to satisfy eehmm... "American Idol on TV tonight?"

Anonymous said...

No word yet from Yun

Wonder if he's on the list?

JBR in California said...

Every day such as this is a day of healing from psychological wound created during the 2001 - 2007 irrationality. Simply stated, I spent 7 years as a renter wondering WTF is going on as my neighbor (who plays the harp for a living) gained several hundred thousand dollars in equity in her house. And now it's time for "legitimate hard work" in America to be rewarded...and stories such as this reinforce my disposition towards our country. Keep em coming Keith, great work.

Nicely put Jeff. I'd like to second your thoughts.

devestment said...

Right on schedule. Exposing the injustice before the administration change keeps it from being a scandal later.

vanilla ice said...

Wow the Feds have finally stopped scratching their asses and started scratching the surface of this debacle. If these 300 people caused $1 billion worth of fraud, at an average house price of $250k, that's 13 living units per fraudster.

Good job. Now when are they going to go after the rest of the $2 or $3 trillion of fraud committed during the greatest con in the history of the world?

Anonymous said...

Anonymous I Hate Frank said...

Hey Frank you friggen jerk! I thought you lived in Newport by the coast. Temp was only 76 with a nice off-shore breeze. My ass, you live in Newport. If you did, you would not need the a/c. I'll be seeing you on one of the off-ramps of the 55 real soon. When I do, I will be sure to throw a few rolls of pennies at your stupid ass.

You douche.

June 19, 2008 7:27 PM<<<

hey, our frank never lies....
I wonder if he is a $30k miilionaire in scottsdale?

consultant said...

This is going to be THE best reality television show for the next few years.

As Keith would say, "we want more, we want more!"

Anonymous said...

It's a beginning everybody . It might be the beginning of a Nation of law and order again . We got to get back to a Nation of law and order again or America is curtains .

All along this bubble was a crime wave of fraud in lending.Why they took so long to get on it is beyond me . Isn't it interesting how right off the back Senator Dodds did not want the fraudulent borrowers and the
fraudulent commissioned sales people to be named as a cause of the rise in prices and high foreclosure rates ? You can't come up with the proper answers to a problem unless you know what is causing it .Certainly when it was discovered that CountryWide had a 37% default rate from the loans that Company made in the height of the bubble ,CountryWide should of been barred from any bail-outs or help from the Senators ,and their brokers should of been investigated immediately .

One billion loss by that group of criminals is just the tip of the iceberg on how many more transactions were caused by fraud in one form or another .The face amount might be One billion ,but it cause 20 billion more faulty loans to be made by appraisals based on using fraudulent comps to up the over-all prices .

This loan crime wave was bigger than anything the mob has ever pulled off .

Thank you Justice Department ,please keep going .

Stanley said...

Note that the original article has been modified, probably from REIC pressure on the AP. It no longer reads "300 realtors and mortgage brokers" but instead "industry players".

Anonymous said...

Arrest the mortgage fraudsters. Release the illegal aliens.

Anonymous said...

These arrests are pretty stupid if you ask me. It's the govt. telling the public "we care about you and are looking out for your good" which is a BIG FAT LIE!

Where was the SEC when these people were setting up this scam? Where was ICE when the illegals were pouring in to provide the labor needed?

If anyone should be arrested first it should be the executives of the regulatory agencies in the govt.

Anonymous said...

.




but, I thought they did nothing wrong?




.

Casey Serin said...

Keith, I've escaped prosecution yet again...!! Sweet deal!

BTW, I may be in the market to fraudulently purchase another couple of homes... I may have to take that realtor outfit up on its offer to pay for my future gay marriage! Win-win for me! Sucks for honest taxpeyers like you Keith! ;-)

Anonymous said...

To people who have committed fraud or are contemplating doing so, FBI Director Robert Mueller said: "We will find you, you will be investigated and you will be prosecuted."

CASEY, THEY ARE COMING TO GET YOU!!

Anonymous said...

too little + too late = too bad

Yoski said...

Mortgage fraudster gets put in a cell with Bubba.
Bubba: "We gonna play man and wife. Who you wanna be?"
Mortgage broker: "Emmm, ehhh.... the man??"
Bubba: "Good! Then get over here and suck you wife's dick"

I hope they put those guys in a real prison. Ever seen Midnight Express? Now that's what I call a prison.

BMW driving sex machine said...

6 in Seattle area indicted in "Malicious Mortgage" crackdown

Six Seattle-area people have been indicted by a federal grand jury in connection with "Operation Malicious Mortgage," a national takedown on mortgage fraud schemes that has resulted in more than 400 arrests nationwide and losses estimated at more than $1 billion — nearly $8.4 million in the Seattle case alone.

Those indicted included a disbarred lawyer, a former bank loan officer and a mortgage broker, according to the U.S. attorney's office. Others include the owner of several shell corporations who "flipped" houses as part of a scheme using unqualified "straw" buyers who allowed inflated loans to be made in their names, only to default on the mortgages, the indictment alleges.

The case is among 144 prosecutions involving 406 people nationally. More than 60 arrests were made Wednesday, the Department of Justice announced.

Among them was Robert Ernest Brandt, 40, a former Bothell attorney who was disbarred in 2006 for failing to properly maintain his client escrow accounts. According to the Washington State Bar, more than $3 million turned up missing from the accounts.

The indictment alleges that Brandt conspired with several others to "flip" houses in Seattle's red-hot real-estate markets in 2004 and 2005, using the shell companies to buy the homes. The alleged conspirators would create loan papers for the straw buyers for inflated purchase prices and pay them up to $20,000 to sign the papers. The loans would not be paid and the banks would foreclose for a loss.

Also indicted were William Anderson, 47, of Bellevue; Mustafa "Marc" Khosraw, 46, of Sammamish; Isaac Palmer, 42, of North Bend; Kristyn Jupiter Moss, 38, of Tacoma; and Zachary Joseph Namie, 30, of Seattle.

Anderson purportedly operated the shell companies that purchased the homes; Moss was a loan officer at Viking Bank and helped create the fraudulent documents; and Brandt and Anderson ran a business called "Escrow Authority" that closed on the sales. Khosraw was a mortgage broker and Namie a loan officer who helped falsify documents, according to the charges. Palmer operated a construction firm, helped recruit straw buyers, and lied that some of them worked for him so they could qualify for loans, the indictment alleges.

In announcing the crackdown, Deputy Attorney General Mark Filip said the Department of Justice is committed to prosecuting mortgage fraud, which he called "a significant threat to our economy, to the stability of our nation's housing market and to the peace of mind of millions of American homeowners."