MANHATTAN (CN) – Two foreclosure profiteers in Brooklyn and the Bronx were sentenced to 5 years in federal prison for conspiracy, wire and bank fraud. Andrea Moore and Michael Irving, who ran the scam before the nationwide economic crisis hit, also must pay $1.5 million in restitution.
From September 2004 to April 2005 they told homeowners facing foreclosure that they could “refinance” their debt through new and larger mortgages. They said the distressed homeowners should sell their homes to third-party straw buyers, who would pay off the old debt let the victims return in a year.
But it didn’t work out that way, a jury said.
“In some instances, Moore and Irving forged the homeowners’ signatures on various documents that transferred the homes to straw buyers without the homeowners’ knowledge,” prosecutors said. They also submitted false financial information on the straw buyers’ loan applications.
The scheme netted $10 million in loans and mortgages. But “in some instances, the defendants failed to make even one payment on the loans, causing the loans to default immediately,” prosecutors said. “In nearly every other case, they eventually failed to make the payments and defaulted on the loans, thereby cashing out on the properties.”
In the end, the distressed homeowners faced eviction; the straw buyers owed hundreds of thousands of dollars to the new owners and the lenders lost money on loan defaults.