CHICAGO -- (February 8, 2008) -- Patrick J. Fitzgerald, U.S. Attorney for the Northern District of Illinois, was joined today by Robert D. Grant, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation (FBI), and Thomas P. Brady, Inspector-in-Charge of the Chicago Office of the U.S. Postal Inspection Service, in announcing that criminal charges have been filed against 25 Chicago area residents, in what is believed to be one of the largest mortgage fraud schemes ever prosecuted in this district.
Those charged were named in one of three separate indictments returned on Tuesday by a Federal Grand Jury in Chicago. All of those charged are scheduled to appear in U.S. District Court in Chicago early next week. The investigation resulting in these charges was a joint effort between the Chicago FBI’s Safe Streets Gang Task Force (SSGTF) and the Postal Inspection Service’s Mail Fraud Team, and was initiated in 2004, following the arrest of 47 known and suspected members of a Chicago based street gang by the SSGTF, in an investigation code named “Operation Marveless.” The charges announced today include mail fraud, wire fraud, money laundering and conspiracy, all of which are felony offenses.
In total, the three indictments allege that over 150 properties, half of which are in foreclosure, were involved in these fraudulent transactions, with potential losses from these fraudulent mortgages in excess of $25 million.
The first indictment alleges that RAYMIE HENDERSON, age 45, NOWELL LANDO, age 35, both of Chicago, and AUGUSTUS WRIGHT, age 48, of Calumet City, Illinois, laundered in excess of $700,000, which were the proceeds from an illegal drug distribution operation centered on Chicago’s south side. WRIGHT, HENDERSON and LANDO are charged with using a portion of the drug proceeds to purchase and renovate real estate in the Chicago area. The drug proceeds were allegedly laundered through a business owned and operated by HENDERSON and LANDO, R & P New Development.
The second indictment charges two employees of mortgage brokerage company Equity Express, Inc., LARRY MELVIN, age 37, of Evanston, Illinois; and MARIA VEGA, age 27, of Country Club Hills, Illinois; along with two other individuals identified as SHAUN CHANEY, age 40, of Park Forest, Illinois; and MARY DOCHEE, age 55, of South Holland, Illinois, with operating a scheme that recruited individuals as “straw buyers” to purchase properties in and around the Chicago area that they were not otherwise qualified to purchase. The indictment alleges that MELVIN, CHANEY and VEGA prepared fraudulent mortgage applications that included false employment, asset and income information, which were designed to induce various lenders to issue mortgages to buyers who would otherwise not have been qualified. The indictment also charges DOCHEE with recruiting buyers and providing false rental information to obtain buyer financing.
The third indictment charges 18 individuals, including loan officers and processors, a Certified Public Accountant, a licensed real estate agent, a tax practitioner, a property manager, numerous property developers, and several property buyers, with devising and operating a scheme to defraud numerous lending institutions by means of false and fraudulent mortgage applications. The alleged leader of this scheme, LARRY J. SKROBOT, age 54, of Matteson, Illinois utilized a land trust to purchase distressed properties in and around the Chicago area. SKROBOT and his co-defendants would then recruit “straw buyers” to purchase these properties. SKROBOT and his co-defendants referred the buyers to loan officers, VARENA MCCLOUD, age 44, of Chicago, Illinois, and JOSEPH MILLER, age 47, of Phoenix, Illinois. The buyers were not qualified to obtain the financing necessary to complete these transactions, and were aided by the loan officers in securing mortgage loans through the use of false employment, income and asset information during the application process.
Others named in this fraud scheme include KARL ALLEN JR, age 43, of Westchester, Illinois; CHARLENE BATALLA, age 26, of Chicago; ALONZO BRAZIEL, age 30, of Chicago, HATTIE BROOKS, age 47, of Chicago; KEVIN EARL, age 35, of Chicago; JAMES T. GREEN, age 36, current residence is unknown; JOSEPH W. GREEN, III, age 48, of Westmont, Illinois; ALFREDO HILADO, age 49, of Bloomingdale, Illinois; JOHN LEWIS, age 60, of Maywood, Illinois; CHRISTOPHER MARCHETTI, age 34, of Chicago Heights, Illinois; JONATHAN MARCHETTI, age 29, of Monee, Illinois; DIANE L. ROBINSON, age 46, of Chicago; DONALD THOMAS, age 49, current residence is unknown; JAMES ROBERT THOMAS, age 49, of Chicago; and JOHNNY WHITE, age 54, of Harvey, Illinois.
In announcing these charges, Mr. Grant noted that the FBI views mortgage fraud as a growing and significant crime problem, with over 1,200 cases opened nationwide in 2007. “The joint investigative effort which led to the charges announced today is just one of the steps that the FBI, along with our state and federal law enforcement partners, are taking to combat this fraud which, as we have recently seen, can have a significant effect on the nation’s economy,” said Mr. Grant.
Inspector Brady added “Mortgage fraud destroys entire communities. As an agency, we will continue to aggressively investigate and seek prosecution of those seeking to do harm to the nation’s economic and financial infrastructure. The U.S. Postal Inspection Service takes this type of criminal activity very seriously and is committed to protecting consumers and the business community from fraud schemes involving the mail.”
The Chicago FBI’s Safe Streets Gang Task Force is comprised of FBI Special Agents and Officers from the Chicago Police Department’s Gang Intelligence Unit.
The public is reminded that an indictment is not evidence of guilt and that all defendants in a criminal case are presumed innocent until proven guilty in a court of law.
EDITOR’S NOTE: Copies of the indictments returned in this case are available from the Chicago FBI’s press office at (312) 829-1199.
SOURCE: Chicago FBI Press Office