More than 1,000 people in Maryland and other states were allegedly duped by a "Dream Homes Program" that promised to take over their mortgage payments in exchange for a half ownership interest in their home and a $50,000 investment in side businesses.

The program was actually a massive mortgage fraud scheme that attracted about $70 million in investments, according to a federal grand jury indictment of four defendants unsealed Monday.

More than 1,000 people in Maryland and other states were allegedly duped by a "Dream Homes Program" that promised to take over their mortgage payments in exchange for a half ownership interest in their home and a $50,000 investment in side businesses.

The program was actually a massive mortgage fraud scheme that attracted about $70 million in investments, according to a federal grand jury indictment of four defendants unsealed Monday.

Metro Dream Homes convinced victims to invest at least $50,000 by refinancing their existing homes or buying new homes at inflated prices, prosecutors said. The company promised to take over victims’ mortgage payments and pay their loans off within five to seven years, using revenue generated by supposedly profitable side businesses.

The side businesses supposedly generated revenue by installing automated teller machines, flat-screen TVs showing advertising, and electronic kiosks in public places, prosecutors said.

In classic Ponzi scheme fashion, investors’ money was instead used to pay off investors in a previous ATM venture, and to pay for salaries and perks for company executives, prosecutors said.

The indictment alleges that Andrew Hamilton Williams Jr., 58, of Hollywood, Fla., was the founder and owner of Metro Dream Homes; Michael Anthony Hickson, 46, of Commack, N.Y., was the chief financial officer; Isaac Jerome Smith, 46, of Spotsylvania, Va., was the president; and Alvita Karen Gunn, 31, of Hanover, Md., was the vice president of operations.

On Aug. 15, 2007, the Maryland securities commissioner issued a cease-and-desist order to Williams, Metro Dream Homes and other related companies, prosecutors said, ordering them to cease the sale of unregistered securities in connection with their promotion of the Dream Homes Program. Hickson is accused of making false statements at a hearing the following month, where he testified that the Dream Homes Program did not rely on new investor funds for revenue.

The four indicted defendants face a maximum sentence of 20 years in prison for the fraud conspiracy; 20 years in prison on each of the 15 counts of wire fraud; and 20 years in prison for conspiracy to commit money laundering. Hickson also faces a maximum sentence of five years in prison for making false statements.

A fifth defendant, Carole Nelson, 50, of Washington, D.C., was charged with money laundering, which carries a maximum penalty of 10 years in prison. Nelson was the chief financial officer of a related company, POS Dream Homes, prosecutors said.

***

What’s your opinion? Leave your comments below or send a letter to the editor.

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
Success!
Thank you for subscribing to Morning Headlines.
Back to top
×
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription