Thursday, June 04, 2015

Jury Drops Hammer On Virginia Real Estate Operator For Running Illegal Short Sale Flipping Racket That Targeted Underwater Homeowners w/ False Promises Of Financial Recovery; Scammer Also Stiffed Gov't Out Of Income Taxes On $700K+ Of Illicit Profits, Then Tendered Fictitious Bonds & Notes In Crackpot Attempt To Satisfy IRS, Mortgage Holder, Other Creditors

From the U.S. Department of Justice (Washington, D.C.):
  • An Ashburn, Virginia resident was convicted [] by a federal jury on 13 charges related to mortgage fraud, passing fictitious financial instruments, and tax fraud, the Department of Justice announced.

    Charise Stone, 46, was indicted on April 15, 2014. According to court records and evidence at trial, Stone targeted distressed homeowners from 2007 to 2010 who owed more on their mortgage loan than the market value of the home with false promises of financial recovery. Stone acquired distressed homeowners’ properties in her own name or under entities she controlled, made false representations to mortgage lenders in order to induce approval of the short sales, and then re-sold the properties – often the same day or the next – to new buyers at a price above the short sale amount, in violation of agreements made with mortgage lenders.

    Jose Marinay owned a settlement company that closed every short sale transaction for Stone. Marinay pleaded guilty to wire-fraud conspiracy on May 27, 2014. At his and Stone’s direction, fraudulent HUD-1 settlement statements were prepared to facilitate the transactions. Marinay destroyed some of the incriminating documents after closings. Financial institutions suffered losses of at least $2.2 million from the scheme. Stone profited more than $700,000 from these transactions but failed to file individual income tax returns. She also sent fictitious bonds to the IRS in an attempt to pay off her tax liability, and she sent fake international promissory notes to creditors purporting to satisfy her credit card debt as well as her mortgage loan.

    Stone faces a maximum penalty of 20 years in prison for each of the wire fraud and wire-fraud conspiracy charges, 30 years in prison for the charges of false statements to a bank, 25 years in prison for the fictitious obligation charges, three years for the charge of corruptly impeding the internal revenue laws, and one year for each count of willful failure to file a tax return at her Aug. 14 sentencing.
Source: Former Short Sale Specialist Convicted of Mortgage and Tax Fraud (Ashburn Resident Did Not Report More Than $720,000 Earned from Scheme).

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