BROOKLYN (CN) – Thomas Kontogiannis, who is serving 8 years in prison for laundering bribes to U.S. Rep. Randy “Duke” Cunningham, led a family-based RICO conspiracy that defrauded a mortgage lender of $50 million, DLJ Mortgage Capital claims in Federal Court.
DLJ claims the decade-long fraud also enriched Kontogiannis’ wife, three daughters, two sons-in-law, nephew and “various friends, business cronies, lawyers and title agents.”
“The RICO defendants have stolen more than $50 million from DLJ in an elaborate and complex mortgage scam spanning several years,” the complaint states. “The scam involved faking at least 95 real estate sales and mortgage loan transactions (the ‘Fraudulent Transactions’), and then selling the bogus loans – by clever manipulation intended to make them appear legitimate – to DLJ and several federally chartered and insured financial institutions, interspersed with the sale of more than 1,800 legitimate real estate mortgage transactions.”
DLJ claims that Kontogiannis and his nephew, John T. Michael, have both “admitted or acknowledged the scam under oath during their criminal proceedings.” It claims Michael is serving 5 years probation for his part in the Cunningham bribery and money laundering.
DLJ, which buys mortgage loans, is represented by Hahn & Hessen of Manhattan.