Seven Triangle real estate professionals sentenced in $44M mortgage-fraud scheme
A federal judge in Raleigh sentenced a passel of Triangle developers, lawyers and brokers in a $44 million mortgage fraud scheme and ordered the eight defendants to pay more than $10 million in restitution and forfeiture.
Chief U.S. District Judge James Dever III sentenced seven defendants from the Triangle and one from New Jersey in the scheme that ran from 2003 through 2009. Dever issued the sentences on Monday and Tuesday in the long-running scheme that that was investigated by a number of federal agencies – FBI, HUD, FDIC, IRS, U.S. Marshals Service – and the Raleigh Police Department.
According to the U.S. Attorney for the Eastern District of North Carolina, the conspirators developed a scheme in which they bought and developed properties for quick resale to people who wouldn’t be able to afford the payments.
They recruited “straw buyers” to sign mortgage documents they could not afford in order to obtain bank loans. The scheme involved paying kickbacks to intermediaries who recruited the “straw buyers,” and proving financing to the “straw buyers” for down payments to buy properties.
The “straw buyers” were promised cash and kickbacks for participating and were told they would not have to make a down payment.
The scheme resulted in losses of several million dollars, the U.S. Attorney said.
Vincent Maldini, 46, a developer and former mortgage broker from Seabright, N.J., was sentenced to 60 months and ordered to make $667,859 in restitution.
Ricky Lamont Congleton, 43, a Zebulon developer, was sentenced to 66 months and ordered to pay $1.2 million to the victims and $3.3 million in criminal forfeitures.
Dexter Tirrell Jones, 42, a former Raleigh mortgage broker, was sentenced to 30 months and ordered to pay $1.4 million in restitution.
Phillip Graham Rose, 42, a closing attorney from Raleigh, was sentenced to 42 months and ordered to pay $1.6 million to the victims of the scheme.
Johnny Ray Peele, 43, a Wake Forest developer, was sentenced to 30 months and ordered to pay $728,244 in restitution.
Dwayne Thomas Hall, 49, a Wake Forest developer, was sentenced to 39 months and ordered to pay $1.2 million to the victims and $7.3 million in forfeiture.
Treshell Mayo Herndon, 39, a former Raleigh real estate broker, was sentenced to 33 months and ordered to pay $1.1 million in restitution.
Joseph Carl Hollis, 35 of Raleigh, participated as a “straw buyer” and later as a recruiter of “straw buyers.” He was sentenced to 5 years of probation, which included an 18-month term of house arrest. Hollis was also ordered to pay $198,500 to the scheme victims.
This story was originally published October 29, 2014 at 10:44 AM with the headline "Seven Triangle real estate professionals sentenced in $44M mortgage-fraud scheme."