Six people have been indicted in an alleged scheme to bilk real estate lenders using straw buyers to obtain mortgages on home sales that never closed, New York Attorney General Eliot Spitzer said.
The scheme involved two bogus sales of a four-bedroom house in East Setauket, Long Island, to straw buyers who allowed their names and credit histories to be used. After selling the house in November 2004 for $870,000 — and making off with more than $750,000 in mortgage loan proceeds from Freemont Investment and Loan — Andreas Perdikos, 41, sold the house again 11 months later for $1.3 million, prosecutors allege.
A fraudulent appraisal and other falsified documents and bank statements were used to secure a new mortgage, prosecutors said.
A lawyer who acted as the legal counsel to banks at both closings, Frank DeGrasse, 45, of South Salem, was also indicted as a co-conspirator “who had full knowledge of the scheme,” prosecutors said. DeGrasse falsified documents, hid the identity of the property’s true owner, and misrepresented how the bank’s funds were paid at the time of closing, the indictment charges.
Another defendant, Lincoln Esteves, 33, of Newark, N.J., is an out-of-state mortgage broker who allegedly helped funnel the second transaction through Sun Trust Mortgage Bank.
The indictment, unsealed July 6 in Suffolk County, is part of an ongoing investigation by the New York Attorney General’s Organized Crime Task Force into mortgage fraud and real estate-related criminal activity.