3 sentenced for role in complex mortgage fraud conspiracy
PHOENIX – Three defendants have each been sentenced to two years in prison on mortgage fraud conspiracy charges following a three-year investigation by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI).
Henry Oliver Ford (a.k.a. Cleothus Lefty Jackson), 37, of West Palm Beach, Fla., was sentenced Dec. 12 by U.S. District Judge Susan R. Bolton to 30 months in prison. Bolton sentenced codefendants Vincent James Vendittelli, 32, of Scottsdale, Ariz., and Jason Mark Chrzanowski, 32, of Farmington, Minn., to 27-month prison terms. All three had previously pleaded guilty to conspiracy to commit wire fraud and received lesser sentences based on their cooperation in another ongoing mortgage fraud investigation.
"The defendants' greed led them to blatantly lie to lending institutions and dupe individuals into getting loans they were not qualified for or had absolutely no means to afford," said acting U.S. Attorney Ann Birmingham Scheel.
"These individuals were building a real estate empire founded in fraud and deceit and, like a house of cards, it quickly collapsed when their illicit scheme was exposed," said Matt Allen, special agent in charge for ICE HSI in Arizona. "HSI will continue its financial investigations to uncover those entities that seek to manipulate the financial system for their own personal gain."
According to court documents, from April 2005 to June 2007, the defendants engaged in a complex conspiracy to commit mortgage fraud. Their scheme involved purchasing residential homes through a third party, inflating the sale prices of the homes, and then using third-party "straw buyers" to purchase them. The defendants told straw buyers that they could purchase a home with the use of their own credit score and that the defendants would maintain the mortgage. The straw buyers were paid a flat fee or a percentage of the sales price of the home after the sale closed at escrow. The defendants then sold the property 12 to 18 months later. Many of the homes purchased through the conspiracy were sold at prices in excess of $1 million and were located in various communities, including Scottsdale and Paradise Valley, Ariz.
All of the straw buyers were directed to Vendittelli at Spectrum Financial Group to obtain the home loans. Vendittelli and others created loan applications for each straw buyer which falsely represented the straw buyer's income, assets, liabilities, intention to occupy the house as a primary residence, and amount and source of the down payment. In some cases, the defendants helped qualify the straw buyers for the loans by either adding a straw buyer to a bank account owned or controlled by the defendant and containing a large amount of money, depositing money into straw buyers' bank accounts, or preparing false verifications of rent or employment for straw buyers.
The properties purchased in this conspiracy have since gone into foreclosure, resulting in millions of dollars in losses to lending institutions.
These cases were prosecuted by Assistant U.S. Attorneys Raymond K. Woo and Kevin M. Rapp of the U.S. Attorney's Office, District of Arizona.