Lender Files Civil Lawsuit Against Players In Alleged South Florida Flipping Scam

In Broward County, Florida, the South Florida Sun Sentinel reports:

• In the two years Patrick R. Newman lived in South Florida, he bought and sold more than a dozen condos — flipping some several times within hours or days — in a mortgage fraud strategy that allegedly duped a bank into approving millions of dollars in questionable loans. Newman died in 2006, as FBI authorities were investigating his multimillion dollar condo-flipping operation. Now, National City Bank — the lending institution that approved more than $14 million in mortgage loans that ultimately were defaulted on — is suing several attorneys, appraisers and businesses who the bank contends assisted Newman.

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• The Newman case spotlights a trend many legal experts predict will escalate in coming months. They expect a surge in litigation as more banks try to recover losses caused by what they contend was mortgage fraud. This is especially true in Florida, which ranked among the top three states in mortgage fraud the past three years.

For more, see Bank sues appraisers and attorneys, alleging fraud in flipping condos (Bank sues appraisers and attorneys, alleging they helped straw buyers and a flipping operation that cost it millions).