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As reported in The Legal Description on July 11, 2023:
Six individuals were indicted for defrauding distressed homeowners by stealing the property deeds to Westchester County homes and fraudulently obtaining $2 million in loans. The defendants, including licensed Realtors and an attorney, were also charged with evading a combined total of nearly $200,000 in state taxes.
As alleged in the indictment, the defendants targeted three residential properties facing bankruptcy or foreclosure, two in New Rochelle and one in Yonkers, valued in total at nearly $2.5 million. Owners for two of the properties believed they were receiving mortgage assistance when they signed over to the defendants the deeds to their homes at a closing. The third property, which was in bankruptcy proceedings, was acquired in a short sale and two of the defendants allegedly moved in and occupied that home as their primary residence. The defendants were charged with forging financial statements and filing false tax documents to obtain $1.5 million in short-term “fix and flip” loans for the properties before defaulting on those mortgages. The homeowners who were expecting a refinanced mortgage faced eviction or were pushed out of their home.
The defendants include licensed real estate brokers Marcia and Fred Campbell of New Rochelle and attorney Anthony Chilliest of New York City. A grand jury charged the defendants across multiple indictments that include conspiracy, larceny, and tax fraud.
The bottom line for attorney title agents: Beware when dealing with short sales, flips and distressed property. Scammers are out there looking to take advantage of vulnerable homeowners or to commit bank fraud. Dig into the details of the deal, and if you see something that doesn’t look legitimate, don’t participate in the transaction.
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