The first four people to be prosecuted under Georgia’s new Residential Mortgage Fraud Act, were indicted this week by a Gwinnett County, Ga., grand jury, media accounts said.

Jason Edward Brenner, 32; James Reuben Price, 48; Charlie Reed Smith Jr., 36; and Tara Shemail Webb, 33, each face three counts of residential mortgage fraud, according to reports.

The four alleged co-conspirators are accused of inflating a home appraisal to steal from a bank, accounts said. The four were accused of trying to secure a loan for $205,000 even though the house they planned to buy on Atwood Street in Atlanta was valued at $140,000, police told the Gwinnett Daily Post.

The suspects, including a buyer, broker, real estate agent and an investor, allegedly inflated the price by placing $60,000 worth of fake liens on the house to funnel money into a “shell” mechanic’s business, Attorney General Thurbert Baker said during a press conference in June, the Daily Post reported.

In June, the suspects accused of swindling a bank in a phony home sale were arrested in Snellville, Ga., at a residential mortgage closing, the first arrests under the Mortgage Fraud Act, reports said.

The approach allegedly used by the four is a variation on a widely practiced scam that has turned metro Atlanta into one of the nation’s worst hot spots for mortgage fraud, federal authorities have said. The Georgia Residential Mortgage Fraud Act, under which the arrests were made, was designed to combat the problem.

The Act, aimed at curbing mortgage fraud, was signed into law May 5 by Georgia Gov. Sonny Perdue. It defines the criminal offense of residential mortgage fraud.

Anyone convicted of engaging in residential mortgage fraud with one property faces one to 10 years in prison and up to a $1,000 fine. Offenders convicted of mortgage flipping two or more properties could receive a sentence from three to 20 years in prison and up to a $100,000 fine for each property.

According to the FBI, Georgia had more mortgage fraud than any other state between 2000 and 2003, and it still ranks among the top states for the crime.

***

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

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