Robert Shumake Questions Motives Behind Mortgage Fraud

There is plenty of opportunity to make money investing in real estate today, legally. I'll never understand why people spend so much time and energy developing scams and schemes when they can just follow the rules and make an honest living. Here's a article about a guy who gets to live in the "Big House" for a while, and I don't mean a "Large Home."

Broker Gets 3½ Years Prison Time for $3.7M Mortgage Fraud; Another Arrested in $500,000 Ponzi Scheme

Posted by Alex Finkelstein 12/07/09 2:39 PM EST
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(PORTLAND, OR) -- Lee Howlett, a 46-year-old former broker at Portland, OR-based Taylor Made Mortgage, has been sentenced to 41 months in prison, to be followed by three years of supervised release, after he was found guilty in a $3.7 million loan application scam.

Acting U.S. Attorney Kent S. Robinson said Howlett used $1.3 million of the $3.7 million for personal uses. Robinson says Howlett submitted 14 false loan applications purportedly to refinance or purchase seven properties during a 2½ -year period between 2003 and 2005.

The applications contained false information about Howlett's employment income, the sources of down payments and the identities of the true borrowers and buyers, Robinson said.

Fraudulent appraisals of the properties by non-existent appraisers were attached to each application, according to the U.S. Attorney.

Robinson described Howlett as "a serial, unrepentant con artist." He said the broker's conduct was "typical of the fraudulent practices which have produced the mortgage and financial crisis of the past two years."

In a separate unrelated case, Rita Gosselin of Grosse Ile, MI was arrested in an alleged $500,000 real estate investment Ponzi scheme. Twenty investors lost their money in the scam.
Michigan Attorney General Mike Cox said Gosselin was charged with racketeering, multiple counts of obtaining money under false pretenses and stealing "hundreds of thousands of dollars" from Michigan families.

Cox said Gosselin orchestrated the scheme between April 2007 and September 2008 in metro Detroit. She allegedly told investors she could purchase foreclosed and distressed properties in bulk and then renovate them to sell at a profit.

Cox said Gosselin provided investors with promissory notes as security for the alleged investments. She promised monthly payments on the notes.

"Taking advantage of Michigan families, especially in today's economy will not be tolerated," Cox said.

Gosselin was arraigned in the 33rd district Court in Woodhaven, MI. Judge Michael McNally scheduled a preliminary hearing Dec. 15 and released Gosselin on a $300,000 cash bail bond.

Robert Shumake Revals Mortgage Fraud Schemes

Here is an article about a system to help protect property owners from mortgage fraud and real estate scams involving false documents. Do you know how many properties you own and how many mortgages are on each one? Read on...you might be surprised.

Ottawa County launches new program for property owners; electronic recording system one of three operating in Michigan counties

By Jeffrey Cunningham | Muskegon Chronicle

December 19, 2009, 6:36AM

GRAND HAVEN — The Ottawa County Register of Deeds office is encouraging everyone in the county who owns land to sign up for a simple program that might save property owners thousands of dollars and years of aggravation.

The program, Property Fraud Alert, allows those registered to be notified every time a property with their name on it is registered with the county.

NOW/Jeffrey CunninghamOttawa County Register of Deeds Gary Scholten points to a sign in his office announcing the Property Fraud Alert program now availabe to county property owners.“Most people don’t realize that property and mortgage fraud is the fastest growing white-collar crime in the country according to statistics provided by the FBI,” said Ottawa County Register of Deeds Gary Scholten.

The program is part of the new electronic recording system the Ottawa County Board of Commissioners approved for several departments earlier this year. The system, from Fidlar Technologies, Inc. of Rockford, Ill., cost $368,000.

“It’s like a smoke detector for your property,” Scholten said.

Scammers usually record a fraudulent quit-claim deed with a county register of deeds office, complete with the all of the legal transaction information and forged signatures and then let it sit for several weeks unbeknownst to the property owner.
“Then, the scammers go to a local bank and apply for a mortgage for upgrades to the home and often walk away with $100,000 or more,” said Ernest Riggen, chief executive officer of the Fidlar Technologies.

“While the real owner of the property does not owe the money, the bank or mortgage company often comes after the homeowner and tries to collect the money the bank has now lost. It can cost the homeowner thousands of dollars to get the matter resolved. It is a lot like identity theft.”

Often, Fidlar said, scammers hit the homes of “snowbirds” who are gone for months at a time and don’t know there is a problem until it is too late.

Scholten said that he is unaware of any similar incidents occurring in Ottawa County so far, but scammers tend to move across the country, and he has heard about such scams occurring on the east side of the state.

“Our job is not to tell whether or not a document is valid or not, we just have to register documents, so this type of program is invaluable so that people know that someone isn’t out there trying to mortgage their property without their permission,” Scholten said. The Property Fraud Alert program, he noted, is free.

The alerts can come by e-mail, text message or by phone anytime a property is recorded by the register of deeds office, Fidlar said. “And for those who are concerned that their elderly parents may be scammed, the children can have their e-mail or phone number put in so that they are contacted in case something happens to their parents’ property.”

Ottawa County is the third county in the state, behind Grand Traverse and Ingam counties, to use the Fraud Alert system.

Those interested in signing up can go to www.propertyfraudalert.com/ottawami or call (800) 728-3858.