Massachusetts Man Pleas Guilty To Pocketing Closing Proceeds Intended To Pay Off Existing Mortgages, Leaving Homes Facing Foreclosure

The Office of the Massachusetts Attorney General recently announced:

• [G]erald Schena, age 57, pled guilty in Suffolk Superior Court to [over 200 charges involving a wide variety of fraudulent conduct].(1)

Among the illegal acts, Schena and co-defendant attorney Bruce Namenson(2) carried out a scheme that defrauded home sellers and buyers and financial lending institutions.

• [B]oth men acted as closing agents for three residential real estate closings. At the time of these sales there were outstanding mortgages on the properties totaling over $500,000. The buyers obtained loans to purchase the properties. After the closings, banks wired funds to Namenson’s business account for the purpose of paying off the outstanding mortgages, with the balance of the proceeds (minus closing costs) payable to the sellers.

• Namenson, with Schena’s help, failed to pay off the over $500,000 in mortgage debts remaining on the homes from before the sales. As a result, the homes were threatened with foreclosure. With Schena’s aid, Namenson attempted to avoid foreclosure and discovery of the thefts by periodically making partial loan payments to the banks.

For the Massachusetts AG's press release, see Medford Man Sentenced to Five Years in Jail After Pleading Guilty to Stealing Identities, Credit Card Fraud, and Other Charges.

(1) Suffolk Superior Court Judge Judith Fabricant sentenced Schena to serve five years in the House of Correction, to be followed by 10 years of probation. As part of his probation, Schena must repay over $500,000 in restitution.

(2) Namenson received five years for his part in the scam. sneaky slick escrow agents gamma