Mortgage

Unlicensed dealer pleads responsible of $ four.75 million mortgage and wire switch fraud

An unlicensed mortgage broker pleaded guilty to a fraud scheme in federal court in New York on Tuesday.

Brent Kaufman of Commack, NY, on Long Island, stole about $ 4.75 million in refinancing proceeds from borrowers in Queens and Long Island between 2016 and 2019 to use inaccurate information for sending money to his personal bank accounts instead of the intended lenders.

This resulted in an unknown number of borrowers unknowingly putting a second mortgage on their homes and foreclosure or near foreclosure. The three defrauded lenders – Home Point Financial, LoanDepot, and United Wholesale Mortgage – suffered a net loss of $ 2.47 million, according to court documents. The lenders did not comment on the case as of the reporting date.

Kaufman, 50, faces up to 30 years in prison, the forfeiture of all assets received from the program and a fine of up to $ 1 million. He is awaiting the sentencing slated for January 26, 2022 and is free with a $ 100,000 bond, the US prosecutor said in a statement to NMN.

To avoid fraud, Kaufman sporadically paid the monthly installments or even paid off part of the mortgage in full. The investigation was conducted by the Eastern District of New York District Attorney's Office, the Federal Bureau of Investigation, the Office of Inspector General of the Federal Housing Finance Agency, and the United States Postal Inspection Service.

"This is a classic case of greed that overcomes honest business practices as Mr. Kaufman used his access to customer funds to enrich his own lifestyle," Darnell Edwards, acting inspector of the USPIS New York Division, said in a press release. "His actions left many in financial ruin, held two mortgages and faced threats of foreclosure."

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