Mortgage Fraud Ring Indicted on Federal Charges
Eric Williams, Aaron Teachout, Isaac Modert, Mario Giannandrea, Rick Artibee, Dennis Sare and Nichole Buda, all Michigan residents, have been indicted for conspiring to commit, and committing, bank fraud in connection with a mortgage fraud scheme that occurred in the Lansing, Michigan area between 2005 and 2007.
The fraud scheme alleged in the indictment indicates that the defendants engaged in an equity stripping scheme involving approximately 35 homes. In the scheme, banks would be asked to finance sham real estate purchases which were designed to extract funds from lenders, which would be split up among the participants in the scheme to be used for their own benefit.
The mortgages were not paid and went into foreclosure, resulting in losses of approximately $1,700,000.
Two of the defendants – Mario Giannandrea and Nichole Buda – are also charged with money laundering in connection with the scheme.
U.S. Attorney Patrick Miles said, “Mortgage fraud schemes like this one hurt everyone in our community. They make it harder for ordinary people to borrow money, and the damage from mortgage frauds to property values hurts public schools and neighborhoods, including residents who hope their homes will be a retirement nest egg. Anyone engaged in mortgage fraud should take warning: we are watching, and your day in court is coming soon.”
Conspiring to commit bank fraud carries a maximum penalty of 30 years in prison, a fine of $1,000,000, an order of restitution and other penalties. The bank fraud statute provides for the same penalties. Money laundering carries a maximum punishment of 20 years in prison, a fine of $500,000, restitution and other penalties.
This prosecution was brought by the Mortgage Fraud Task Force, made up of investigators from the Federal Bureau of Investigation, the United States Secret Service, the United States Postal Inspection Service, the Department of Housing and Urban Development, Office of Inspector General, the Michigan Attorney General’s Office and the Lansing Police Department. Prosecution of the case is assigned to Timothy VerHey and Ronald Stella, Assistant United States Attorneys.
The charges in an indictment are merely accusations, and a defendant is presumed innocent until and unless proven guilty in a court of law.