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Lawyer Receives 10 Year Sentence for Mortgage Fraud
December 22, 2014 — Leave a comment
Michelle V. Mallard, 47, Charlotte, North Carolina, was sentenced by Chief U.S. District Judge Frank D. Whitney to serve ten years in prison followed by two years of supervised release on mortgage fraud and related charges. Mallard was one of 91 defendants charged in Operation Wax House.
Mallard’s conviction is the latest in Operation Wax House, an investigation which began in 2007. Of the 91 individuals charged, eighty-nine defendants have either pleaded guilty or
have been convicted following trial. The two remaining defendants are international fugitives.
Mallard, a/k/a Michelle Crawford, pleaded guilty mid-trial in July 2013 to mortgage fraud conspiracy, money laundering conspiracy and embezzlement in violation of the wire fraud statute.
According to court documents, Mallard served as a closing attorney for the mortgage fraud conspiracy, agreeing to use her law license to close fraudulent mortgage transactions for the conspiracy operating primarily in South Charlotte and Waxhaw, N.C. According to evidence introduced at Mallard’s trial, the conspirators purchased houses at inflated prices in exchange for large kickbacks and the defendant accepted bogus checks to make it appear as though buyers had provided money when they had not and agreed to pay kickbacks to other members of the conspiracy.
Evidence further showed that Mallard was stealing money from her trust account when she began participating in the mortgage fraud, and, as a result of that embezzlement, was unable to pay off a client’s prior mortgage, leaving the unknowing victim with a house that the victim no longer owned but upon which the victim was still required to make mortgage payments.
Prior to imposing the 10 year sentence, Chief Judge Whitney found that Mallard had committed perjury and attempted to obstruct justice, finding that Mallard’s testimony during a hearing in which she attempted to withdraw her guilty plea was“brimming with inconsistences and verbal gymnastics.” The Court also found that evidence introduced during the hearing on the withdrawal of plea was “indicative of a motive to thwart the judicial process.”
Mallard was remanded into custody following the sentencing hearing to immediately begin serving her sentence.
Mallard was one of six defendants charged in Wax House Case No. 3:11cr374, and the last of those defendants to be sentenced. In prior hearings, the Court imposed the following
sentences on those charged with Mallard:
Christopher Belin, 35, who served the mortgage fraud conspiracy as a real estate agent, was sentenced to 33 months in prison;
James E. Fink, 44, (also charged in Case No. 3:12cr239), who served the mortgage fraud conspiracy as a builder/seller and mortgage broker, was sentenced to 46 months
in prison;
Jimmy Hitchcock, 44, who served the conspiracy as a buyer and promoter, was sentenced to 46 months in prison;
Mitzi Jackson, 41, who served the conspiracy as a bank insider, was sentenced a split sentence of 18 months, with 9 months in prison; and
Coley Scagliarini, 44, who served the conspiracy as a mortgage broker, was sentenced to 46 months in prison.
The U.S. Attorney’s Office for the Western District of North Carolina. John A. Strong announced the sentence, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI), join the U.S. Attorney’s Office in making the announcement.
Operation Wax House in the Western District of North Carolina is being handled by the Charlotte Division of the FBI and the Criminal Division of the IRS for the Financial Fraud Enforcement Task Force, along with the Securities Division of the North Carolina Secretary of State with respect to a separate prosecution. The Mallard prosecution and sentencing for the government was handled by Assistant United States Attorney Maria K. Vento.
Michelle V. Mallard, 47, Charlotte, North Carolina, was sentenced by Chief U.S. District Judge Frank D. Whitney to serve ten years in prison followed by two years of supervised release on mortgage fraud and related charges. Mallard was one of 91 defendants charged in Operation Wax House.
Mallard’s conviction is the latest in Operation Wax House, an investigation which began in 2007. Of the 91 individuals charged, eighty-nine defendants have either pleaded guilty or
have been convicted following trial. The two remaining defendants are international fugitives.
Mallard, a/k/a Michelle Crawford, pleaded guilty mid-trial in July 2013 to mortgage fraud conspiracy, money laundering conspiracy and embezzlement in violation of the wire fraud statute.
According to court documents, Mallard served as a closing attorney for the mortgage fraud conspiracy, agreeing to use her law license to close fraudulent mortgage transactions for the conspiracy operating primarily in South Charlotte and Waxhaw, N.C. According to evidence introduced at Mallard’s trial, the conspirators purchased houses at inflated prices in exchange for large kickbacks and the defendant accepted bogus checks to make it appear as though buyers had provided money when they had not and agreed to pay kickbacks to other members of the conspiracy.
Evidence further showed that Mallard was stealing money from her trust account when she began participating in the mortgage fraud, and, as a result of that embezzlement, was unable to pay off a client’s prior mortgage, leaving the unknowing victim with a house that the victim no longer owned but upon which the victim was still required to make mortgage payments.
Prior to imposing the 10 year sentence, Chief Judge Whitney found that Mallard had committed perjury and attempted to obstruct justice, finding that Mallard’s testimony during a hearing in which she attempted to withdraw her guilty plea was“brimming with inconsistences and verbal gymnastics.” The Court also found that evidence introduced during the hearing on the withdrawal of plea was “indicative of a motive to thwart the judicial process.”
Mallard was remanded into custody following the sentencing hearing to immediately begin serving her sentence.
Mallard was one of six defendants charged in Wax House Case No. 3:11cr374, and the last of those defendants to be sentenced. In prior hearings, the Court imposed the following
sentences on those charged with Mallard:
Christopher Belin, 35, who served the mortgage fraud conspiracy as a real estate agent, was sentenced to 33 months in prison;
James E. Fink, 44, (also charged in Case No. 3:12cr239), who served the mortgage fraud conspiracy as a builder/seller and mortgage broker, was sentenced to 46 months
in prison;
Jimmy Hitchcock, 44, who served the conspiracy as a buyer and promoter, was sentenced to 46 months in prison;
Mitzi Jackson, 41, who served the conspiracy as a bank insider, was sentenced a split sentence of 18 months, with 9 months in prison; and
Coley Scagliarini, 44, who served the conspiracy as a mortgage broker, was sentenced to 46 months in prison.
The U.S. Attorney’s Office for the Western District of North Carolina. John A. Strong announced the sentence, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI), join the U.S. Attorney’s Office in making the announcement.
Operation Wax House in the Western District of North Carolina is being handled by the Charlotte Division of the FBI and the Criminal Division of the IRS for the Financial Fraud Enforcement Task Force, along with the Securities Division of the North Carolina Secretary of State with respect to a separate prosecution. The Mallard prosecution and sentencing for the government was handled by Assistant United States Attorney Maria K. Vento.
Attorney Sentenced for Running $20M Investment Scam
December 22, 2014 — Leave a comment
Kevin Sniffen, 53, Phoenix, Maryland, an attorney licensed in Maryland, was sentenced by U.S. District Judge J. Frederick Motz sentenced to three years in prison, followed by three years of supervised release, for conspiring to commit wire fraud arising from an investment fraud scheme. Sean Krondak, 44, Irvine California, was sentenced to six months of home detention as part of three years’ probation for obstructing justice.
Judge Motz also ordered Sniffen to pay restitution of $15.85 million.
According to their plea agreements and court documents, Sniffen and Krondakwere part of a fraudulent scheme carried out by Patrick Belzner and Brian McCloskey. McCloskey owned a real estate development business known as the McCloskey Group, LLC. Belzner, a home builder, began working withMcCloskey in late 2008 or early 2009. Krondak was employed as the Vice President – Loan Officer & Underwriting at IAG Underwriters, LLC, (IAGU) run by Mervyn Phelan. IAGU, which maintained an office in Newport Beach, California, was in the business of underwriting loan applications submitted by real estate developers and then locating project financing from banks and other financial entities. Gregory Grantham, an attorney, held the position of IAGU’s general counsel on a part-time basis as a contract employee. IAGU began working with the McCloskey Group trying to locate sources of financing for its projects in about 2009.
Beginning in 2009 and continuing through June 2011, Belzner and McCloskeypersuaded a number of private lenders to loan funds to the McCloskey Group to establish that it had cash reserves or “liquidity” in connection with its efforts to secure funding for real estate development projects through IAGU. Belzner andMcCloskey falsely represented that the funds would be maintained in an escrow account under the control of Kevin Sniffen, a licensed attorney and escrow agent in Baltimore County; that the funds would not be used for any other purpose; and that the money would be returned to the lender, either upon the funding of the loan or after a specified period of time. In return for this temporary use of the lender’s funds, Belzner and McCloskey promised to pay substantial rates of interest.
Beginning in about the late summer of 2010, Phelan and Grantham cooperated with Belzner and McCloskey in their scheme to defraud by (1) making false representations to help persuade lenders to make loans to the McCloskey Groupin order to establish “liquidity”; (2) telling the lenders that the funds had to be placed in an escrow account controlled by Kevin Sniffen; and by (3) making false representations to dissuade previous escrow account lenders from demanding the return of their funds when the original time period established for the loan expired without the McCloskey Group obtaining financing for the project in question. In particular, Phelan and Grantham repeatedly advised escrow account lenders that funding for a particular project was imminent when they knew this was not the case, and in one case falsely represented that they were holding millions of dollars in escrow funds tendered by one group of lenders. Krondakknowingly participated in the scheme by sending e-mails and other communications that he knew contained false information to victim lenders directly, or to Belzner, McCloskey and Sniffen for them to use in their contacts with the victim lenders.
Once the lenders transferred their funds into the escrow accounts, Belznerdirected McCloskey, Sniffen, and other conspirators to remove those funds from the escrow accounts without the knowledge of the lenders. Belzner andMcCloskey then used the stolen funds to repay earlier loans to the McCloskey Group and to Belzner personally; to meet ongoing business expenses of theMcCloskey Group; and to support Belzner’s life-style. The total losses resulting from the scheme were approximately $20 million.
After the scheme was exposed, Krondak assisted Phelan and Grantham in withholding and destroying relevant e-mails in response to federal grand jury subpoenas issued to IAGU and to Phelan and Grantham personally.
Patrick J. Belzner, a/k/a Patrick McCloskey, 45, Selbyville, Delaware, was sentenced to 15 years in prison for wire fraud conspiracy, wire fraud and tax evasion, and was ordered to pay $19.805 million in restitution. Brian McCloskey, 42, Baltimore, and Mervyn A. Phelan, Sr., 74, Newport Beach, California, each pleaded guilty to his role in the conspiracy and are both scheduled to be sentenced on December 23, 2014. Gregory E. Grantham, 57, Oceanside, California, was sentenced to five years in prison and ordered to forfeit and pay restitution of $17.4 million.
The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service—Criminal Investigation, Washington, D.C. Field Office.
United States Attorney Rod J. Rosenstein thanked the FBI and IRS – Criminal Investigation for their work in the investigation. Mr. Rosenstein praised Assistant U.S. Attorneys Jefferson M. Gray and Kathleen Gavin, who prosecuted the case.
Kevin Sniffen, 53, Phoenix, Maryland, an attorney licensed in Maryland, was sentenced by U.S. District Judge J. Frederick Motz sentenced to three years in prison, followed by three years of supervised release, for conspiring to commit wire fraud arising from an investment fraud scheme. Sean Krondak, 44, Irvine California, was sentenced to six months of home detention as part of three years’ probation for obstructing justice.
Judge Motz also ordered Sniffen to pay restitution of $15.85 million.
According to their plea agreements and court documents, Sniffen and Krondakwere part of a fraudulent scheme carried out by Patrick Belzner and Brian McCloskey. McCloskey owned a real estate development business known as the McCloskey Group, LLC. Belzner, a home builder, began working withMcCloskey in late 2008 or early 2009. Krondak was employed as the Vice President – Loan Officer & Underwriting at IAG Underwriters, LLC, (IAGU) run by Mervyn Phelan. IAGU, which maintained an office in Newport Beach, California, was in the business of underwriting loan applications submitted by real estate developers and then locating project financing from banks and other financial entities. Gregory Grantham, an attorney, held the position of IAGU’s general counsel on a part-time basis as a contract employee. IAGU began working with the McCloskey Group trying to locate sources of financing for its projects in about 2009.
Beginning in 2009 and continuing through June 2011, Belzner and McCloskeypersuaded a number of private lenders to loan funds to the McCloskey Group to establish that it had cash reserves or “liquidity” in connection with its efforts to secure funding for real estate development projects through IAGU. Belzner andMcCloskey falsely represented that the funds would be maintained in an escrow account under the control of Kevin Sniffen, a licensed attorney and escrow agent in Baltimore County; that the funds would not be used for any other purpose; and that the money would be returned to the lender, either upon the funding of the loan or after a specified period of time. In return for this temporary use of the lender’s funds, Belzner and McCloskey promised to pay substantial rates of interest.
Beginning in about the late summer of 2010, Phelan and Grantham cooperated with Belzner and McCloskey in their scheme to defraud by (1) making false representations to help persuade lenders to make loans to the McCloskey Groupin order to establish “liquidity”; (2) telling the lenders that the funds had to be placed in an escrow account controlled by Kevin Sniffen; and by (3) making false representations to dissuade previous escrow account lenders from demanding the return of their funds when the original time period established for the loan expired without the McCloskey Group obtaining financing for the project in question. In particular, Phelan and Grantham repeatedly advised escrow account lenders that funding for a particular project was imminent when they knew this was not the case, and in one case falsely represented that they were holding millions of dollars in escrow funds tendered by one group of lenders. Krondakknowingly participated in the scheme by sending e-mails and other communications that he knew contained false information to victim lenders directly, or to Belzner, McCloskey and Sniffen for them to use in their contacts with the victim lenders.
Once the lenders transferred their funds into the escrow accounts, Belznerdirected McCloskey, Sniffen, and other conspirators to remove those funds from the escrow accounts without the knowledge of the lenders. Belzner andMcCloskey then used the stolen funds to repay earlier loans to the McCloskey Group and to Belzner personally; to meet ongoing business expenses of theMcCloskey Group; and to support Belzner’s life-style. The total losses resulting from the scheme were approximately $20 million.
After the scheme was exposed, Krondak assisted Phelan and Grantham in withholding and destroying relevant e-mails in response to federal grand jury subpoenas issued to IAGU and to Phelan and Grantham personally.
Patrick J. Belzner, a/k/a Patrick McCloskey, 45, Selbyville, Delaware, was sentenced to 15 years in prison for wire fraud conspiracy, wire fraud and tax evasion, and was ordered to pay $19.805 million in restitution. Brian McCloskey, 42, Baltimore, and Mervyn A. Phelan, Sr., 74, Newport Beach, California, each pleaded guilty to his role in the conspiracy and are both scheduled to be sentenced on December 23, 2014. Gregory E. Grantham, 57, Oceanside, California, was sentenced to five years in prison and ordered to forfeit and pay restitution of $17.4 million.
The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service—Criminal Investigation, Washington, D.C. Field Office.
United States Attorney Rod J. Rosenstein thanked the FBI and IRS – Criminal Investigation for their work in the investigation. Mr. Rosenstein praised Assistant U.S. Attorneys Jefferson M. Gray and Kathleen Gavin, who prosecuted the case.
Stamford, CT - Attorney Convicted of Fraud
Link to story - http://www.justice.gov/usao/ct/Press2014/20140214.html
May 22nd, 2014
"Stop Attorney Abuse, Stop Attorney Fraud..."
A Stamford attorney has pleaded guilty in mortgage fraud case that drained $7 million from various lending institutions, according to the Connecticut United States Attorney.
The U.S. Attorney's office announced Friday that on Feb. 12, Christopher Brecciano, 35, of Stamford, waived his right to indictment and pleaded guilty in Bridgeport federal court to conspiring to defraud financial institutions through an extensive mortgage fraud scheme that involved dozens of properties in Fairfield County.
According to court documents and statements made in court, between 2006 and 2010, Brecciano, while working as an associate at a Stamford law firm, participated in mortgage fraud conspiracy that involved the purchase of numerous single and multi-family properties, primarily in Bridgeport, Norwalk and Stamford.
Brecciano acted as a closing attorney for at least 50 mortgage loan transactions in which materially false information was provided to mortgage lenders by Brecciano or his co-conspirators. The fraudulent information included false verifications of down payments for real estate transactions, false deeds, and false HUD-1 Forms.
In many of the transactions, Brecciano knew that the borrower was a “straw buyer,” and that other individuals intended to control the property and collect rent from the property. In many transactions, Brecciano distributed mortgage loan funds to the straw buyer and other co-conspirators at the closing.Many of these properties ended up in foreclosure, or in short sale transactions.
In pleading guilty, Brecciano admitted that he was also involved in many short sale transactions in which he knew that the buyer and seller were working together to retain control of the property while representing to the lender that the sale was an arm’s length transaction.Through this scheme, lenders suffered losses of more than $7 million.
Brecciano pleaded guilty to one count of conspiracy to commit wire fraud and bank fraud. He is scheduled to be sentenced by Chief U.S. District Judge Janet C. Hall on May 7, and faces a maximum term of imprisonment of 30 years.
The ongoing investigation is being conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Ann M. Nevins and Special Assistant U.S. Attorney John McReynolds.
"Stop Attorney Abuse, Stop Attorney Fraud..."
Ma'ayergi & Associates, LLC
Attorney Christopher Michael Brecciano
Christopher Michael Brecciano Attorney Brecciano has been a member of the Connecticut Bar and 2nd Circuit Federal Bar for the past two years. He joined the firm of Ma'ayergi and Associates in the summer of 2005 as a part of the growth and expansion of its real estate division into the tri-state metropolitan area. Prior to this, he worked as a real estate attorney for Riefberg, Smart, Donohue and NeJame in Fairfield County conducting closings for Cendant Mobility, the country's largest provider of employee relocation services to the private and public sectors. Attorney Brecciano received his law degree from Quinnipiac University School of Law, where he was one of only three students honored at graduation for their excellence in clinical work. Attorney Brecciano received his undergraduate degree from the University of Connecticut and has been a resident of the State for the past ten years.
Contact: cmbrecciano@maesquire.com
May 22nd, 2014
"Stop Attorney Abuse, Stop Attorney Fraud..."
A Stamford attorney has pleaded guilty in mortgage fraud case that drained $7 million from various lending institutions, according to the Connecticut United States Attorney.
The U.S. Attorney's office announced Friday that on Feb. 12, Christopher Brecciano, 35, of Stamford, waived his right to indictment and pleaded guilty in Bridgeport federal court to conspiring to defraud financial institutions through an extensive mortgage fraud scheme that involved dozens of properties in Fairfield County.
According to court documents and statements made in court, between 2006 and 2010, Brecciano, while working as an associate at a Stamford law firm, participated in mortgage fraud conspiracy that involved the purchase of numerous single and multi-family properties, primarily in Bridgeport, Norwalk and Stamford.
Brecciano acted as a closing attorney for at least 50 mortgage loan transactions in which materially false information was provided to mortgage lenders by Brecciano or his co-conspirators. The fraudulent information included false verifications of down payments for real estate transactions, false deeds, and false HUD-1 Forms.
In many of the transactions, Brecciano knew that the borrower was a “straw buyer,” and that other individuals intended to control the property and collect rent from the property. In many transactions, Brecciano distributed mortgage loan funds to the straw buyer and other co-conspirators at the closing.Many of these properties ended up in foreclosure, or in short sale transactions.
In pleading guilty, Brecciano admitted that he was also involved in many short sale transactions in which he knew that the buyer and seller were working together to retain control of the property while representing to the lender that the sale was an arm’s length transaction.Through this scheme, lenders suffered losses of more than $7 million.
Brecciano pleaded guilty to one count of conspiracy to commit wire fraud and bank fraud. He is scheduled to be sentenced by Chief U.S. District Judge Janet C. Hall on May 7, and faces a maximum term of imprisonment of 30 years.
The ongoing investigation is being conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Ann M. Nevins and Special Assistant U.S. Attorney John McReynolds.
"Stop Attorney Abuse, Stop Attorney Fraud..."
Ma'ayergi & Associates, LLC
Attorney Christopher Michael Brecciano
Christopher Michael Brecciano Attorney Brecciano has been a member of the Connecticut Bar and 2nd Circuit Federal Bar for the past two years. He joined the firm of Ma'ayergi and Associates in the summer of 2005 as a part of the growth and expansion of its real estate division into the tri-state metropolitan area. Prior to this, he worked as a real estate attorney for Riefberg, Smart, Donohue and NeJame in Fairfield County conducting closings for Cendant Mobility, the country's largest provider of employee relocation services to the private and public sectors. Attorney Brecciano received his law degree from Quinnipiac University School of Law, where he was one of only three students honored at graduation for their excellence in clinical work. Attorney Brecciano received his undergraduate degree from the University of Connecticut and has been a resident of the State for the past ten years.
Contact: cmbrecciano@maesquire.com
Guilty Pleas of Dewey Staff Law Firm Detailed the Alleged Fraud Against Clients
Updated March 28, 2014 6:41 p.m. ET
Lawyer Arrested for Allegedly Submitting False Loan Application and ID Theft
Lawyer charges $900 for sex with client
Attorney practice suspended for billing client for sex...
March 12, 2014
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