Make us your home page
Instagram

Today’s top headlines delivered to you daily.

(View our Privacy Policy)

Florida attorney general sues 25, claiming mortgage fraud

The Florida Attorney General's Office today sued 10 companies and 15 individuals for their alleged roles in a major mortgage fraud scheme first reported by the St. Petersburg Times last year.

In number of defendants, the case may be the largest mortgage fraud case ever filed in the United States, the office said.

According to the lawsuit filed in Orlando, the ring obtained more than $37-million in mortgages for at least 60 home purchases and siphoned off more than $6-million of the proceeds for their own use. Approximately 50 of the houses later went into foreclosure.

"In this particular situation, the economy is the victim,'' Attorney General Bill McCollum said. "This group of individuals systematically defrauded banks and mortgage lenders, stealing millions for their own personal use and leaving a gaping hole in the system.''

Starting in July 2005 and continuing through at least January 2007, three of the ring's leaders allegedly defrauded lenders by recruiting "straw buyers'' with good credit and using them to create false applications to buy homes throughout Central Florida.

The lawsuit, filed by the Attorney General's Mortgage Fraud Task Force, claims the ring conspired with Realtors to artificially inflate purchase prices, thus enabling them to obtain larger mortgage loans.

Among those named in the suit is Allen Boyarsky, 51, a former mortgage company executive who was involved in several questionable transactions with Realtor Lori Polin, one of ReMax's top agents in 2006.

As the Times reported last November, an anonymous letter sent to ReMax's Denver headquarters and to many of her fellow agents alleged that Polin had artificially boosted the prices of nine homes in Tampa and North Pinellas.

Most of the houses were mortgaged for far more than the actual sales price, with the buyer or a third party pocketing the difference.

Today's lawsuit does not name Polin, 49, as a defendant though the suit says Boyarsky asked her to inflate the prices of certain properties listed for sale with Re/Max Mutual Realty Inc., the Clearwater firm she was working for at the time.

In one case, the suit says, Polin originally listed an Oldsmar home for $649,900, then increased the listing price to $725,000. It was placed under contract by Jeannette Lugo, who had been paid $10,000 to be the straw buyer.

The sellers of the property did not receive the increased sales price, which instead went to a trucking company whose owner got $100,000 from the loan proceeds at closing.

The suit says Boyarsky and co-defendant Marcus Habeeb of American Heritage Mortgage Group prepared a loan application for Lugo that falsely indicated she made $17,800 a month as a "senior executive partner" for an investment firm. Lugo, also a defendant in the suit, actually worked for Sprint as a customer service representative.

The Oldsmar house went into foreclosure in January and is now on the market for $351,900 even though it sold for $725,000 to Lugo two years ago.

None of the defendants could immediately be reached for comment. Polin, who now works for a Re/Max office in Tampa, told the Times in 2007 that she was an "innocent victim'' who had been duped by Boyarsky.

Polin is not named as a defendant because real estate agents are exempted from the Deceptive and Unfair Trade Practices Act under which the others are being sued. However, the Attorney General's office said there may be a separate investigation by the state Department of Business and Professional Regulation, which oversees the real estate industry.

A criminal investigation of the alleged fraud ring is also underway.

Habeeb, another defendant in the suit, told the Times last year that he was closing his mortgage business in Florida "because all you got is fraud going on.''

Florida attorney general sues 25, claiming mortgage fraud 09/17/08 [Last modified: Wednesday, September 24, 2008 6:37pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...
  1. What was Rays RF Steven Souza Jr. thinking on that comically bad dive?

    Blogs

    What could Rays RF Steven Souza Jr. been thinking in the seventh inning Friday when he dove for a ball and came up yards short?

    Actually, he insisted after all the laughing, teasing and standing ovation from the Twins fans was done, it was a matter of self-preservation.

  2. Judge tosses life sentences for D.C. sniper Lee Boyd Malvo

    Nation

    McLEAN, Va. — A federal judge on Friday tossed out two life sentences for one of Virginia's most notorious criminals, sniper Lee Boyd Malvo, and ordered Virginia courts to hold new sentencing hearings.

    A federal judge has tossed out two life sentences for D.C. sniper shooter Lee Boyd Malvo. [Associated Press, 2004]
  3. Zbigniew Brzezinski, President Carter's national security adviser, dies

    News

    Zbigniew Brzezinski, the hawkish strategic theorist who was national security adviser to President Jimmy Carter in the tumultuous years of the Iran hostage crisis and the Soviet invasion of Afghanistan in the late 1970s, died on Friday at a hospital in Virginia. He was 89.

    Zbigniew Brzezinski, former national security adviser to President Jimmy Carter, participates in Senate Foreign Relations Committee hearing on Capitol Hill on March 5, 2009, in Washington, D.C. [Photo by Mark Wilson/Getty Images]
  4. USF eliminated by UCF in AAC baseball; Florida, FSU, Miami win

    Colleges

    CLEARWATER — Roughly 16 hours after a ninth-inning collapse against East Carolina in the American Athletic Conference's double-elimination baseball tournament, USF returned to Spectrum Field presumably set for a reboot.

    It simply got booted instead.

    ’NOLES win: Tyler Holton gets a hug from Drew Carlton after his strong eight innings help Florida State beat Louisville.
  5. Pinellas licensing board executive director settled hundreds of cases without getting his board's approval

    Local Government

    By Mark Puente

    Times Staff Writer

    Eleanor Morrison complained to the Pinellas licensing board in 2015 that her contractor installed crooked walls and windows and poured too much concrete for her carport.

    Eleanor Morrison poses at her home in Treasure Island, 5/26/17. Morrison filed a complaint with the Pinellas County Construction Licensing Board and later learned that its former Executive Director, Rodney Fischer, dismissed the case in a private meeting with the contractor.