Tough economic times brings out mortgage fraud schemes

When things get tough, those who want to make money illegally find new schemes. Mortgage fraud is on the upswing.

“Just recently, the Colorado Attorney General indicated that three local Denver residents were indicted for running an intricate mortgage fraud scheme through their property management company. The indictment is not exactly short either; there are 23 counts listed. The three conspirators were evidently diverting funds from home sellers or funding companies through their property management company from April 2006 to September 2008,” said Miller Leonard, a Denver federal criminal defense lawyer and State criminal defense lawyer.

The management company was actually a shell corporation. This is a “shell” business that operates to route money etc. without the company having any assets or operations. Shell companies are not illegal on their own and some have legitimate purposes. They are also commonly called front companies or mailbox companies.

“During any deals that the three were a party to, they allegedly filled out false loan applications to deceive lenders; used false inspections to reroute money to their company and manipulated closing documents while skimming funds off real estate deals,” outlined Leonard. Each of the defendants faces three felony charges and one is suspected of a class two felony under the Colorado Organized Crime Control Act.

Just because something “looks” like someone may have committed a crime and the evidence also points in that direction, does not mean the person did commit that crime. “This is what being defense counsel means, that everyone gets a defense, because they may ‘not’ have done what they are accused of doing. Unfortunately, the perception these days is that if someone is arrested for a crime, that they ‘did’ it. There is just a good a possibility that they ‘didn’t’ do it. That’s my job, to show that it is possible they did ‘not’ commit a crime,” said Leonard.

Not only does defense counsel offer the defendant a defense, they are offering them what they should have in the first place, before assumptions got in the way, the presumption that they are innocent until proven guilty. “While these three defendants may have been indicted for mortgage fraud because the evidence looked good to do so, this does not mean they are, and if they are, defense counsel needs to address their state of mind at the time of the alleged crime,” Leonard pointed out.

“The thing people need to remember about the law and whether someone is charged or not, is that there are always at least two sides to every case. We need to hear both sides without any preconceptions,” he insisted.

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