Massachusetts Attorney/Title Agent Cops Plea In "Mortgage Stacking" Scam; Pocketed $2M+ While Stiffing Existing Lienholders On Loan Payoffs

From the Office of the Massachusetts Attorney General:

• Attorney General Martha Coakley’s Office announced the guilty plea of a former Somerville real estate attorney [...] in connection with making false statements on mortgage applications and associated documents and using the funds secured from the loans for his own purposes, rather than paying off existing loans as directed by the new lenders.

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• While practicing as a real estate lawyer in Somerville and Medford, [Kevin] Carey engaged in a scheme called “mortgage stacking” on four residential properties he or his family members owned. The scheme involved serially refinancing the loans on these properties, without paying off the existing loans. Carey was also the agent for a New England title insurance company which allowed him to issue title insurance policies on mortgage transactions he processed.

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• When he received the proceeds of the loans, Carey did not pay off the existing mortgages on these properties, but rather used the funds for his own benefit. Carey issued title insurance policies or commitments in connection with the transactions, and the lenders were therefore protected, but ultimately the title insurance company suffered the financial loss. As a result of this scheme Carey stole over $2 million.

For the Massachusetts AG press release, see Attorney General Martha Coakley’s Office Announces Guilty Plea of Former Somerville Lawyer in Connection with Stealing Over $2 Million From Mortgage Lenders in Mortgage Stacking Scheme. EscrowRipOffKappa