Thursday, October 15, 2015

Running Loan Modification Racket That Clipped Upfront Fees Out Of 1,000+ Homeowners Among Alleged Real Estate Frauds That Lands Long Island Pair In Hot Water w/ Local Feds

From the Office of the U.S. Attorney (Central Islip, New York):
  • An eleven-count indictment was unsealed [] in United States District Court for the Eastern District of New York charging David Gotterup, also known as “David Gott,” and Jason Green with conspiracy to commit mail fraud, wire fraud, and bank fraud in connection with a scheme to defraud homeowners who were attempting to modify their mortgage loans, and related mail fraud counts. The indictment also charged Gotterup with conspiracy to commit wire and bank fraud in connection with a scheme to improperly obtain mortgage loans, and related bank fraud counts, disaster loan fraud, and aggravated identity theft.


    According to court filings, from 2008 to 2012, Gotterup and Green defrauded distressed homeowners who were seeking relief through government mortgage modification programs by convincing more than a thousand homeowners to pay thousands of dollars each in advance fees based on false promises.

    Gotterup also defrauded financial institutions and the Federal Housing Administration by obtaining mortgages on properties in Brooklyn and Queens by falsifying loan applications and providing false documentation to support the loan applications. In addition, Gotterup used another person’s social security number in connection with these schemes.

    After Hurricane Sandy in 2012, Gotterup also applied for a low-interest disaster relief loan from the U.S. Small Business Administration (SBA), allegedly using false information to support the application. As a result, Gotterup received a loan of $113,900 from the SBA. Instead of using the funds to repair property damaged in the disaster, Gotterup used the money to pay for personal expenses, including wedding-related expenses in Cancun, Mexico.
Source: Two Long Island Men Arrested For Defrauding Homeowners In Loan Modification Scheme (David Gotterup also Charged with Defrauding Banks, Committing Identity Theft and Filing False Claims to Obtain Disaster Relief Money After Hurricane Sandy).