Recruiters in Multi-Million Dollar Mortgage Fraud Sentenced to Prison
BOSTON – November 23, 2015 – (RealEstateRama) — A Virginia man and woman who recruited participants into a multi-year, multi-property mortgage fraud scheme in Roxbury and Dorchester were sentenced this week in U.S. District Court in Boston.
Jerrold Fowler, 31, of Virginia, was sentenced by U.S. District Court Judge Richard G. Stearns to two years in prison, three years of supervised release, and ordered to pay restitution of $3,786,815 and to forfeit $7,413,712. In June 2015, Fowler pleaded guilty to one count of wire fraud and one count of bank fraud.
Thursa Raetz, 40, of Virginia, was sentenced by Judge Stearns to two years in prison, three years of supervised release and ordered to pay restitution of $3,099,224 and to forfeit $7,413,712. In June 2015, Raetz pleaded guilty to two counts of wire fraud and one count of bank fraud.
Between September 2006 and April 2008, Michael David Scott, a former real estate developer, arranged to purchase multi-family residences in Roxbury and Dorchester and then sold individual condominium units in the buildings to straw buyers recruited by him and his co-conspirators, Fowler and Raetz. Scott, Raetz, and Fowler recruited the straw buyers with promises that they would not have to make down payments, pay any funds at the closing, or be responsible for mortgage payments, and with assurances that they also would share in profits when the units were resold. In order to obtain mortgage loans in the names of the straw buyers, Scott, Raetz, and Fowler submitted mortgage loan applications that falsely represented key information, including the buyers’ income, personal assets, down payment, and intention to reside in the condominiums. The mortgage lenders (nine national mortgage companies and one local bank) were led to believe that the straw buyers had made substantial down payments and paid substantial sums at closings.
On Nov. 12, 2015, Scott, who also pleaded guilty to charges arising out of his role in the scheme, was sentenced to 135 months in prison, five years of supervised release and ordered to pay restitution of $11,374,201 and to forfeit $7,413,712.
United States Attorney Carmen M. Ortiz; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston, made the announcement today. The case was prosecuted by Assistant U.S. Attorneys Victor A. Wild of Ortiz’s Economic Crimes Unit and Ryan M. DiSantis of Ortiz’s Public Corruption Unit.