Friday, April 03, 2015

Philly Feds Put Pinch On Local Real Estate Operator Who Allegedly Conspired w/ Title Agent Cohorts To Illegally Pocketing $643K+ In Loan Closing Proceeds Intended For Lien Payoffs; Allegedly Made "Lulling" Payments To Prior Lienholders For Years After Perpetrating Ripoff In Failed Attempt To Dodge Discovery & Keep Scam From Imploding

From the Office of the U.S. Attorney (Philadelphia, Pennsylvania):
  • Dean Rossi, 49, of Warrington, PA, was arrested [] in connection with an alleged mortgage fraud scheme, announced United States Attorney Zane David Memeger. Rossi, a real estate investor who owned numerous low-income properties throughout the Philadelphia area, was charged by indictment, [...], with conspiracy, mail fraud affecting a financial institution, and bank fraud.

    The indictment alleges that Rossi misappropriated in excess of $643,000 from real estate closings. After obtaining bank loans to purchase or refinance residential properties, Rossi allegedly teamed up with title/closing agents to divert a substantial portion of the loan proceeds. According to the indictment, Rossi received cash from the settlements that otherwise should have been used to pay off prior mortgages and tax liens on certain properties.

    To prevent the scheme from being detected, Rossi allegedly continued to cause payments to be made on the prior existing mortgages years after those loans were supposed to have been paid in full.(1)

    If convicted, the defendant faces a possible advisory sentencing guideline range of 46 to 57 months in prison, up to five years of supervised release, a fine of up to $4 million, and a $400 special assessment.
Source: Bucks County Real Estate Investor Arrested On Fraud Charges.

For the indictment, see USA v. Rossi.

(1) These payments made to avoid/postpone detection are sometimes referred to as "lulling" payments (ie. as in "lulling the scam victims to sleep" while preventing (or deferring) ultimate implosion and detection of the scheme by law enforcement authorities).

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