Here is another example of a recent legal case involving a fraudulent real estate scheme committed by a real estate agent. I try to post case summaries in order to provide timely updates to real estate professionals on important issues.
On May 11, 2009, Oladipo Olafunmiloye, a real estate agent, was sentenced to 46 months in prison, to be followed by five years of supervised release, for bank fraud and money laundering in connection with a scheme to defraud mortgage lenders. At the sentencing, the judge found that Mr. Olafunmiloye’s fraudulent scheme incurred losses of $3 million and ordered him to pay restitution in that amount, as well as forfeit his interest in a Rolls Royce automobile and funds held in four bank accounts.
According to his plea agreement, Mr. Olafunmiloye owned a real estate company known as LAFA. From November 2004 to December 2006, Mr. Olafunmiloye organized a scheme in which co-defendants Sidney Okosun, Oyekunle Ikudayisi, Kolawole Aminu and others sought to fraudulently obtain mortgages and refinance loans to purchase properties for sale in Maryland and the District of Columbia that were owned by Mr. Olafunmiloye or LAFA. The defendants recruited individuals to act as purchasers who became owners of the properties in name only and made almost none of the payments related to the purchase of the properties, including down payments, closing costs and mortgage payments
Mr. Olafunmiloye supervised the submission of false statements on loan applications as to the straw buyers’ incomes and their intent to make the properties their primary residences, in order to induce mortgage lenders to make loans at more favorable rates. Mr. Olafunmiloye also provided capital to the other defendants in order to perpetuate the scheme. Once the purchase of the properties had been funded, Mr. Olafunmiloye defaulted on mortgage payments, which forced the lenders to foreclose, thereby incurring losses.
During the course of the scheme, Mr. Olafunmiloye also provided false information to obtain loans in his own name, including loans on five properties, all of which went into foreclosure, resulting in losses to the mortgage lenders of over $492,767. Finally, Mr. Olafunmiloye laundered money obtained from the fraud scheme, including 12 transactions from August 2005 to September 2006 totaling $308,311.
It’s amazing what some people will do to make money.
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