Tuesday, May 10, 2016

NYC Federal Jury Convicts Ringleader Of Nationwide Loan Modification Scam That Used Govt's HAMP Program As Backdrop To Fleece Over 30,000 Homeowners Out Of Over $30 Million

From the Office of the U.S. Attorney (New York City):
  • [D]IONYSIUS FIUMANO, a/k/a “D,” was found guilty [] in Manhattan federal court of orchestrating a massive mortgage modification scheme through which he and his co-conspirators defrauded more than 30,000 American homeowners out of a total of approximately $31 million.

    Manhattan U.S. Attorney Preet Bharara said: “Dionysius Fiumano was the ringleader of a heartless criminal conspiracy that preyed on desperate homeowners struggling to pay their mortgages. Claiming to offer a lifeline to homeowners, Fiumano deceived tens of thousands into paying exorbitant fees for mortgage modification services they never got.”

    Special Inspector General Christy Goldsmith Romero said: “A jury convicted Dionysius Fiumano for his role in orchestrating an elaborate advance fee scheme that defrauded more than 30,000 struggling homeowners out of more than $30 million. Using the Treasury’s Home Affordable Modification Program (HAMP) as the backdrop for their fraud, Fiumano and his co-conspirators conned homeowners who had fallen behind on their mortgage payments into believing their mortgages were being modified. In reality, they did little or nothing to help these homeowners. And when consumer complaints attracted attention, the co-conspirators renamed their companies to continue the fraud. These crimes were uniquely despicable, as HAMP is a free federal government housing program designed to help those most impacted by the financial crisis. Rather than offer relief, Fiumano added to the distress and despair of thousands of innocent Americans struggling to stay in their homes.”

    According to the Indictment other filings in Manhattan federal court and the evidence presented at trial:

    FIUMANO was the general manager of sales at Vortex Financial Management, Inc., a/k/a Professional Marketing Group, a/k/a Professional Legal Network (“PMG”), an Irvine, California, company that offered purported “mortgage modification” services, that is, assistance persuading the homeowner’s lender to agree to a modification to the terms of the homeowner’s mortgage to make it more affordable. In that capacity, FIUMANO oversaw PMG’s sales staff of approximately 65 telemarketers and managers.

    From about November 2011 through May 2014, FIUMANO perpetrated a scheme to defraud homeowners in dire financial straits who were seeking relief through government mortgage relief programs.
    At FIUMANO’s direction, FIUMANO’s sales staff called and emailed homeowners who received PMG’s fraudulent solicitations. During these calls, in an effort to convince the homeowners to pay up-front fees, FIUMANO, through his sales staff, regularly lied to homeowners, including by saying that (a) the homeowners were retaining a “law firm” and an “attorney” who would complete a mortgage modification application and negotiate aggressively on the homeowners’ behalf with banks to modify the terms of the homeowners’ mortgages; (b) the homeowners had been “pre-approved” or “pre-qualified” to receive a mortgage modification; (c) PMG employed underwriters who would calculate and guarantee the homeowners a new, modified rate and monthly mortgage payment; and (d) the up-front fees paid by the homeowners would be paid directly to the homeowners’ lenders, to the attorneys to pay their fees, or to pay the purported “hard costs” of the modification.

    In truth and in fact, and as FIUMANO well knew, all of these representations were false.
Source: California Man Found Guilty In Manhattan Federal Court Of Orchestrating $31 Million Mortgage Modification Fraud Scheme (More Than 30,000 Homeowners Victimized in Largest Mortgage Modification Scheme Ever Charged).