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Four Floridians convicted in N.C. mortgage fraud

Four Florida residents were convicted Thursday in federal court in Miami of a complex $50 million mortgage fraud involving dozens of other Floridians who agreed to become paid "straw buyers'' of land in the North Carolina mountains.

Domenic Rabuffo, 77, of Miami, his former wife, Mae Rabuffo, 75, of Fort Lauderdale, Ray Olivier, 52, of Land O'Lakes and Curtis Allen Davis, 51, owner of Executive Mortgage & Investments in Tampa, were immediately ordered to jail by U.S. District Judge K. Michael Moore before sentencing Sept. 18.

Each faces a maximum of 30 years in prison for each of several counts of conspiracy and bank fraud.

Rabuffo and the development, called Hampton Springs, were featured in a series of stories about the unusual loans and construction in the Tampa Bay Times in 2008.

A former federal informer and companion of New York crime family members, Rabuffo was charged with organizing the scheme over five years until 2008. Assistant U.S. Attorney Dwayne E. Williams accused him of using straw buyers to take title to lots in a pristine mountaintop subdivision near Cashiers, N.C. The buyers then obtained millions of dollars in mortgages from SunTrust, Bank of America, Wachovia and Regions Banks, all of which ultimately foreclosed.

Several others indicted with Rabuffo in January have entered guilty pleas.

Using Olivier, a Florida engineer who moved to North Carolina to manage the property and direct operations, Rabuffo began acquiring the land in 2003 and put most of it in his ex-wife's name. Then with the help of Davis, a SunTrust employee and others, they recruited "buyers'' who never paid any money for the land but instead obtained mortgage money deposited into joint accounts with Rabuffo. Each buyer was supposed to collect $12,500 a year for allowing the use of his or her name. Several contacted by the Times said they were never paid.

Rabuffo and Olivier began construction on more than a dozen homes that have not been finished.

Deeds recorded for the purchases indicated a sales price of $650,000 an acre, an amount far exceeding the value of land in the area, which rarely sells for more than $15,000 an acre.

The unfinished homes, now crumbling hulks, have been foreclosed on by banks and sold for small amounts of money. Some banks even gave some of the property away to charitable organizations. Jackson County building officials have refused to issue permits to allow the completion of any of the homes because the development, in a remote area 10 miles north of Cashiers, has no sewer and water service.

Rabuffo went to prison in the 1980s in New York after he was convicted in a similar financial fraud indictment. His former business partner was killed in a 1987 mob hit as he dined at an Italian restaurant in Manhattan. Rabuffo refused to discuss the killing or his past when interviewed by the Times in 2008, but insisted he was not associated with mobsters.

Four Floridians convicted in N.C. mortgage fraud 07/03/14 [Last modified: Thursday, July 3, 2014 10:22pm]
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