Industry News

Mortgage broker pleads guilty in $50 million real estate fraud

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A Cincinnati, Ohio, mortgage broker pleaded guilty in U.S. District Court to bank fraud, conspiracy and income tax evasion charges in an ongoing federal probe of fraud in the buying and selling of low-priced homes in that town, the Cincinnati Enquirer reported Saturday. Kelvin Mitchell, branch manager for Mortgages Unlimited, prepared loan applications that he knew were false because they overstated the borrowers' income and assets, federal investigators said, according to reports. He is the latest of more than three-dozen individuals who have pled guilty or been sentenced in the probe by the U.S. Attorney's Office, FBI, Internal Revenue Service and U.S. Postal Inspection Service into mortgage fraud involving more than $50 million in properties, reports said. According to investigators, the fraud involved recruiting buyers and falsifying pay stubs and loan documents based on artificially inflated appraisals of low-priced real estate, and the scheme centered on "flipping," the practic...