Feds: 4 NYers Ran $10M Subprime Mortgage Scam

Scam spanned multiple boroughs

Four New Yorkers have been charged in a $10 million subprime mortgage scam that relied on ex-convicts and residents from a public housing project pretending to be homebuyers.
Federal prosecutors say in an indictment unsealed in Manhattan that the vast majority of the mortgages obtained by the defendants are now in default or in foreclosure.
The indictment says that the recruits acted as “straw buyers,'' purchasing properties in Brooklyn, Queens, Long Island and Westchester County in 2006 and 2007.
Prosecutors say the defendants obtained mortgages for the buyers for amounts greater than the actual sale through fraudulent appraisals. The defendants are accused of pocketing the difference between the loan amount and the lesser amount paid for the homes.

Copyright AP - Associated Press
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