BIRMINGHAM—A federal judge today sentenced a Brookwood man to 18 months in prison on false statement charges related to an almost $750,000 mortgage fraud scheme in the Birmingham area, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Patrick J. Maley.

Scott Eric Perry, 35, pleaded guilty in February to making false statements to lending institutions in connection to real estate transactions between February 2006 and December 2006. Along with his prison term, U.S. District Judge Karon O. Bowdre ordered Perry to pay $746,865 in restitution to Wells Fargo, J.P. Morgan-Chase, and Bank of America. Wells Fargo is to receive $505,764; J.P. Morgan-Chase, $180,432; and Bank of America, $60,668.

Perry is scheduled to report to prison September 12.

“Mortgage fraud harms banks and lending institutions. It also damages neighborhoods and communities,” Vance said. “Homes surrounding a foreclosed property tend to lose value. Foreclosed properties also are often abandoned, and the vacant houses become a source of vandalism or crime,” she said. “We must fight and prosecute this fraud.”

According to court documents, Perry, doing business as Master Industries, bought houses in Jefferson County for the purpose of reselling them. From about February 22, 2006 through Decemver 21, 2006, he sold numerous properties to various buyers throughout the Birmingham area. In each of these transactions, a federal Department of Housing and Urban Development form, known as a HUD-1 Settlement Statement, is required. The form is intended to disclose who is to pay and who is receive money as part of the real estate transaction.

Perry signed and submitted the statements as true and accurate but failed to disclose that he both made the down payments for the purchase of the homes and paid the purchasers at least $3,000 as an incentive to buy the properties. By submitting the false documents, Perry induced the lenders to authorize mortgage loans they would not otherwise have approved.

source: FBI