Alleged Pennsylvania Ponzi Scheme Head Pleads Guilty Of Swindling 800+ Victims Out Of Millions

(original post -11-10-07; last modified 11-16-07)
In Harrisburg, Pennsylvania, Lancaster Online reports:

• Wesley A. Snyder pleaded guilty in U.S. District Court in Harrisburg Friday to a mail-fraud scheme that defrauded more than 800 mortgage customers, including about 300 in Lancaster County. An evidentiary hearing was canceled Thursday because Snyder's lawyer worked out a plea agreement with the U.S. Attorney for the Middle District of Pennsylvania. The agreement requires Snyder to make restitution to his victims, which the court stipulates to be somewhere between $15 million and $32 million.

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• Authorities said that since 1988 Snyder took in more than $65 million from 811 purchasers of his "wraparound" mortgages but forwarded only $39 million to the banks and other institutions that provided the financing. [...] Snyder's wraparound mortgages were essentially second contracts tied to larger mortgages he brokered in their names with outside banks.

For more, see Snyder pleads guilty to mail fraud (Owner of bankrupt mortgage business admits to fraud involving more than 800 customers and faces paying up to $32 million in restitution).

Go here for an illustration of how the refi / wraparound mortgage scam works.

See also:

• Bear gets 23 co-sponsors for bill (Tough mortgage laws) (Lancaster Online - 11-20-07),
• Truth or consequences (Confessed mortgage scammer faces even stiffer penalties — if he fails to admit everything) (Lancaster Online - 11-15-07),
• Broker ‘not a scam artist’ (No fraudulent intent, says Snyder’s lawyer) (Lancaster Online - 11-15-07),
• Scam victims: guilty plea a 'shallow victory' (Mortgage lender admits mail fraud, pledges to cooperate in probe) (Lancaster Online),
• Pa. mortgage firm head to plead guilty (The Associated Press) (if link expires, try here),
• Broker pleads guilty to mail fraud (Feds said Berks County mortgage business was mere pyramid scheme) (The Allentown Morning Call),
• Firms’ owner to plead guilty (The Republican & Herald) ("Snyder concealed documents from Pennsylvania Banking Department auditors and told his workers not to tell the examiners about the wraparound program, according to the charging documents filed Friday.").

Go here and go here for other posts and links to earlier media reports on the Pennsylvania Ponzi scheme involving Wesley Snyder, OPFM, Image Masters.