Three New York residents were charged in a case involving mortgage fraud, Nassau County, N.Y., officials said Monday.

Alton Lawson, 43, of Queens; Chester W. Matthews, 54, of Richmond Hill; and Reginald Johnson, 32, of Brookhaven, were charged with grand larceny and felonies in an alleged fraud scheme, Nassau County District Attorney Denis Dillon said Monday.

The principal defendant “attempted to steal the homes of two victims who were facing financial hardship by engaging in an elaborate real estate foreclosure rescue scam,” according to Dillon.

Dillon said all three defendants worked together to defraud a 45-year-old Roosevelt woman and an 80-year-old Hempstead woman who were having financial difficulties.

Lawson allegedly visited each of the two homeowners and told them he could help them save their homes by refinancing. Dillon said Lawson tricked the victims into selling their houses to Matthews for $295,000 and $320,000.

The “sales” took place in Garden City and Mineola, Dillon alleged.

Matthews, who was serving as a “straw,” or phony, buyer for Lawson, was able to purchase the properties of the victims by obtaining mortgages for the full amounts from Fremont Investment and Loan of Brea, Calif., and BNC Mortgage Inc. of Irvine, Calif., on the basis of fraudulent income information submitted on the mortgage applications, Dillon alleged.

Johnson, who was the mortgage broker from Reliable Capital Corp., allegedly provided the fraudulent mortgage application that was submitted to BNC Mortgage Inc., which enabled Matthews to “purchase” the Hempstead home, according to Dillon.

Johnson also allegedly provided Lawson a “show” settlement check made out to the Hempstead victim for $15,852 that was shown at the closing, which enabled the loan to close. Dillon said that after the closing, Johnson had the check deposited into his bank account at North Fork Bank.

Although the outstanding mortgage on the Roosevelt victim’s house was paid, Dillon said, that victim received nothing, while Lawson received mortgage proceeds totaling $46,384.

Although the tax lien on the Hempstead victim’s home was paid, she received only $150,555 of the mortgage proceeds, Dillon said, while Lawson received mortgage proceeds totaling $110,500, according to Dillon.

Matthews was paid $17,500 and $20,000 by Lawson for serving as the “straw” buyer on each of the two properties, and Johnson was paid $10,715 from the mortgage proceeds for serving as the mortgage broker on the sale of the Hempstead house, Dillon alleged.

Dillon said, “After essentially stealing the houses of the two victims and retaining substantial portions of the mortgage proceeds, Lawson, in the name of Matthews, the purported owner of the properties, had begun eviction proceedings to evict each complainant.”

Lawson, who is alleged to have been the principal architect of this so-called fraud, has been charged with two counts of grand larceny, a Class C felony and two counts of criminal possession of a forged instrument in the second degree, a Class D felony.

Johnson has been charged with one count of grand larceny in the second degree, a Class C felony and one count of criminal possession of a forged instrument in the second degree, a Class D felony. Matthews has been charged with two counts of grand larceny, a Class D felony and two counts of criminal facilitation.

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Send tips or a Letter to the Editor to janis@inman.com or call (510) 658-9252, ext. 140.

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