It didn’t garner much local attention, but a certain local condo building — along with a few close friends — made a star appearance in last week’s big mortgage-scam announcement by the FBI. More than 400 people were charged in 144 separate mortgage fraud cases nationwide over the last 3 months as part of the agency’s “Operation Malicious Mortgage.” Six of those arrests were in Houston:
This indictment charges Houston-area residents Frankthea Annette Williams, Ishmael Boyd Laryea, Charles Joseph-DeShawn Wilson, Kristen Anne Way and Robert Wilfred Stanley, and Tasha Rene Bellow, of Burbank, Calif., with engaging in a scheme to defraud by providing false and fraudulent information to residential lenders to induce the lenders to fund the purchase of single family homes and condominium units.
11 News reporter Allison Triarsi describes how the scams worked:
The suspects would find a home for sale, letâ€™s say $200,000.
They would then get a phony appraisal that would almost double the homeâ€™s actual value. In that case, $400,000.
The culprits would then look for an investor. Thatâ€™s someone to actually put the house in their name using their good credit for the closing and title.
A bank would then loan the money for the house, which has the phony appraisal value. The crooks would then pay the seller the $200,000 asking price and pocket the other $200,000.
Here’s a question. If you were trying to run this scam, where would you find properties you could get appraised for as much as twice their actual value? Sure, Houston had some price runups . . . and yes, appraisals can be played. But why fake something you don’t have to?
Stop thinking so hard. Why not target properties that are actually worth a lot less than what most people think they are? Triarsi delivers the punchline:
Itâ€™s alleged the group used this scheme to purchase expensive condominiums on Yupon Street in Houston as well as near The Galleria area on Briar Hollow and McCue.
- Mortgage fraud scheme lands 6 in jail [KHOU.com]
- More Than 400 Defendants Charged for Roles in Mortgage Fraud Schemes as Part of Operation “Malicious Mortgage” [FBI]
- Six Charged in Mortgage Fraud Indictment as a Result of Operation Malicious Mortgage [Department of Justice]
- Previously in Swamplot: Tremont Tower: How Bad Could It Be, Really?, Tremont Tower Video: How Construction Problems Attract Foreclosure Pileups, The Dirty Little Secret Behind the Montrose Foreclosure Hump
Photo of Tremont Tower: HAR