US: Four charged in USD 15 mn mortgage fraud scheme
Newark, Feb 1 : Four individuals from New Jersey were taken into custody on Thursday for their alleged roles in a USD 15 million mortgage fraud scheme on an indictment returned by a federal grand jury on January 30, 2013, U.S. Attorney Paul J. Fishman announced.
The four defendants are: Fredric M. Diantonio, 40, of Wildwood, New Jersey; Louis V. Catarro, 60, of Runnemede, New Jersey; Kathryn W. Lockwood, 43, of Wildwood Crest, New Jersey; and Thomas E. Morello, 55, of Mt. Laurel, New Jersey.
All defendants were charged with conspiracy to commit wire fraud. Diantonio, Catarro, and Lockwood were also charged with conspiracy to commit money laundering.
In addition, Diantonio and Catarro were charged with making false statements to the U.S. Department of Housing and Urban Development.
The defendants were expected to appear in on Thursday before U.S. Magistrate Judge Karen M. Williams in Camden federal court.
According to the indictment:
Real estate agents Diantonio, Catarro, and Lockwood located properties in Wildwood and North Wildwood, New Jersey, for sale by real estate developers such as Morello. Diantonio, Catarro, and Lockwood caused real estate sales contracts to be created, which listed deposit monies from buyers that often were not collected.
The conspirators also agreed that sellers such as Morello would pay kickbacks to the buyers of the properties without disclosing the kickbacks to the lending institutions funding mortgages used by the buyers to purchase the properties.
The conspirators caused fraudulent documents to be signed at real estate closings, including U.S. Department of Housing and Urban Development Settlement Statements, which failed to disclose the kickbacks paid to the buyers or which falsely stated that a deposit toward the purchase of the property had been collected. Diantonio, Catarro, and Lockwood received real estate sales commissions for putting the transactions together.
The wire fraud conspiracy charge is punishable by a maximum potential penalty of 30 years in prison and a USD 1 million fine. The money laundering conspiracy charge carries a maximum potential penalty of 10 years in prison and a USD 250,000 fine. The false statements charge carries a maximum potential penalty of two years in prison and a USD 250,000 fine.
U.S. Attorney Fishman credited special agents from the FBI's Atlantic City Resident Agency, under the direction of Acting Special Agent in Charge David Velasquez in Newark; special agents from the FBI's Newtown Square Resident Agency, under the direction of Acting Special Agent in Charge John J. Brosnan in Philadelphia; special agents from IRS-Criminal Investigation in Philadelphia, under the direction of Special Agent in Charge Akeia Conner; and special agents from the Department of Housing and Urban Development Office of Inspector General, under the direction of Special Agent in Charge Joseph Clarke in Philadelphia for the investigation leading to the Indictment and arrests.
The government is represented by R. Stephen Stigall, Attorney in Charge of the U.S. Attorney's Office Criminal Division in Camden.
The charges and allegations contained in the indictment are merely accusations, and the defendants are considered innocent unless and until proven guilty.