Time for a field trip!

Why not? I'm dying to see where the person who purchased the house that's at the center of the mortgage fraud that we've discussed over the last week lives. From the recorded documents we learned that Leonor Essonreid purchases a home in lovely Coral Gables from John Arthur Romney AKA Property Collateral Inc for the hefty sum of $1,080,000. Take a look for yourselves, isn't 911 Columbus Blvd a lovely piece of real estate?

I have to wonder, what kind of home did she have before this purchase? Maybe something less expensive in the Gables? Perhaps an apartment on Brickell? Maybe even an older art deco home on the beach? Let's find out, first we find her address as it appears on the mortgage for the property located at 911 Columbus Blvd...

There it is outlined in red, 421 East 15th St Apartment 4, Hialeah Florida. Ok, now we're off to see what kind of lovely home Ms. Essonreid owned before trading up to a home in one of the most affluent areas of South Florida. From a quick map quest search we find that Ms. Essonreid lives right around the corner from the world famous Hialeah race track...

Ok, so it's off to Hialeah where we find 421 East 15th St...

Oh god that can't be right! Let's look again...

It turns out that Ms Essonreid does indeed live in this little 1,839 square foot home, to add insult to injury, she lives in one of four 460 square foot efficiencies that makes up this little fourplex. Interesting how someone living in one of the poorest areas in Miami can go ahead and move up to a home in one of the wealthiest areas of Miami that probably has a walk in closet thats the same size as her current home!


Interesting step up for Ms Essonreid huh? Tomorrow we move on to DOMESTIC VIOLENCE!

Five more minutes and a $1,080,000 later...

We left off last week demonstrating how we could find a massive mortgage fraud case with a bare minimum of effort and about five minutes of searching on the Miami Dade County Recorders office.  First we did a quick search and found a warranty deed for a property purchased by convicted mortgage fraudster John Arthur Romney through his company "Property Collateral". 

After examining the deed we were able to conclude that although the deed wasn't recorded till over four years later, the actual transaction had occurred on November 21, 2006.  Through the cost of the documentary stamps, we were able to deduce that the purchase price of the home in question was $755,000 and since we were not able to find a recorded mortgage for the purchase of this property by Property Collateral Inc, we can only assume that it was a cash purchase.

Next we found that there was a lis pendens filed on the property on November 4, 2009 which signaled the beginning of a foreclosure action against the property.  What struck us as strange was that although the company that purchased the property for what we presumed was all cash, they were still named in the foreclosure action.  The property was purchased on November 21, 2006 for all cash yet they're still named in a foreclosure suit?  We then searched for mortgages on the property by using the names of the other people named in the foreclosure suit and found that there was another lis pendens filed against the property, this one on September 22, 2008, a little more than year before the first one was filed.  Even worse now, two different lis pendens on the property and still no recorded mortgage!  Once again we attempt to search using the names of the other people named in the foreclosure suit for the subject property when we stumble upon this...

Here we find two mortgages recorded on the same day June 4, 2007 for the same property for a borrower named Leonor Essonreid.  Interesting?  Let's summarize what we have at this point...

• John Romney aka Property Collateral, Inc. purchases subject property located at 911 Columbus Blvd for $755,000 on November 21, 2006 for what we presume is all cash since there is no recorded mortgage.
• Mortgage is recorded against the property on June 4, 2007 naming Leonor Essonreid as the borrower even though there is no record of the ownership of the property being transferred to her.
• Lis pendens filed against the property on September 22, 2008.
• A second lis pendens filed against the property on November 21, 2009.
• A deed filed on August 3, 2010 conveying ownership of the property from Raul Romero to Property Collateral, Inc. even though the documents were originally signed four years earlier on Novermber 21, 2006.

With me so far or does the time line not make any sense to you?  It's not supposed to but a quick look at Leonor Essonreid's mortgages should explain everything.  Here are the first two pages of the first mortgage, as always, click on the image to enlarge it...

Did anyone catch it?  Even though the mortgage for reasons that can't be explained was recorded on June 4, 2007, the actual closing took place on November 21, 2006!  Who would have guessed it?!  Also note on page two that the amount of the mortgage was $880,000.  As if that wasn't bad enough, take a look at the second mortgage for the same property...

Brilliant, another mortgage recorded on the same day as the first for an additional $200,000 bringing the total amount borrowed against this property to $1,080,000.

I'm sure the astute among you have already realized that John Romney aka Property Collateral, Inc didn't purchase this property for cash on November 21, 2006.  What happened here was that the lender had already funded the loan for Leonor Essonreid in the amount of $1,080,000 and the attorney who was handling the closing had the money sitting in their trust account.  As soon as the money was available, the attorney paid the original seller of the property ($755,000), prepared a deed for the transfer of the property to John Romney aka Property Collateral who simultaneously sold the property to Leonor Essonreid whose loan proceeds were used to fund the entire fraud.  At the end of the day a deed was never recorded conveying the property to Ms. Essonreid, after all what was the point?  I'm sure Ms Essonreid had no interest in the property other than what came along with her role as a straw buyer, since the entire deal was a scam, why would the closing agent worry about recording a deed?  When all was said and done, Mr Romney and his co conspirators in this seven figure fraud walked away with a tidy profit of $325,000.  Not bad for a days work.

Amazing what you can find with as little as five minutes worth of searching online, isn't it?  Tomorrow, we're going to try to find Ms Essonreid and get some idea what a million dollar home buyer looks like.

Another installment of the "Five minute mortgage fraud investigation" and learning to master the obvious...

It's that easy folks! Yesterday we left off with a troubling deed that we found on the Miami Dade County clerk of courts website that involved a company owned by convicted mortgage fraudster John Romney. We asked our readers to take a good look at the document and see what didn't seem kosher about it. Here's the document again...

The document is simple enough, a simple deed from the seller, Raul Romero, to the buyer, Property Collateral Inc which is owned by John Romney.

Let's start with the most obvious problem with this document, the dates. From the notary section on page two we see that a notary named Aned Perdomo notarized this deed on November 21, 2006, no problem right?

But then a closer look at the top right of the first page reveals that the deed wasn't recorded till nearly four years later!

WTF is that about? Why wouldn't the closing agent record the deed right after the closing?

Moving on, we can also deduce the sales price of the home to Property Collateral through the documentary stamps, in this case based on the clerks stamp it looks like the doc stamps were $4,530.00. In Dade county the doc stamps are calculated at the rate of 60 cents per hundred dollars of the sales price, so in this instance based on the doc stamps the sales price of the home would have been $755,000. So far so good right?


What's troubling is that after another search of the County Recorders Office we can't seem to find a mortgage for Property Collateral's purchase of this property which means that it must have been paid for in cash. Interesting, let's go back to the recorders office website and see if we find anything else regarding this property...

HUH? Check the item high lighted in yellow, it's a lis pendens for this very property! According to this it looks like Deutsche Bank began foreclosure proceedings against this property on November 9, 2009. Let's take a look at that document...

How can you file a lis pendens in 2009 when the deed wasn't recorded till 2010? This must mean that there was a mortgage somewhere between November 21, 2006 when Property Collateral aquired the property and November 4, 2009 when the foreclosure action was initiated. So where's this mortgage? It can't be in Property Collateral's name otherwise we would have seen it when we searched the County Recorders website. What now? Let's take another look at this Lis Pendens, specifically who's being sued...

Perhaps searching the recorders website using one of these other defendants names will provide a clue as to what's going on. Let's give it a shot...

Bingo, now we find another lis pendens for the same property that didn't appear in our previous search, one that was filed a little over a year before the others. Huh?! Let's take a look at the document...

JEEZE! Let's take a look at the defendants...

DAMN! They're suing everyone and their brother! At the very least we can identify Raul Romero as being the guy who sold the property to Property Collateral, but who the hell is "Leonor Essonreid"?

This is where things get really interesting, back to the County Recorders website and a quick search for Leonor Essonreid...

Viola, there you have it. Two mortgages for the same property apparently recorded after Property Collateral aka John Romney purchased the property or so it seems...

The next part gets real good, we'll discuss on Monday.

Just how hard is it to investigate and find a fraudulent real estate transaction?

There have been a number of rumors circulating over the last few months surrounding the circumstances of convicted fraudster John Romney's mortgage fraud case and the arrangements that were afforded to him in exchange for testimony against other people he worked with throughout his criminal career. I have to wonder though, why in the world would any law enforcement agency need to make a deal with someone who's involved in a paperwork intensive crime like Mortgage Fraud? After all, the evidence is all there on paper and recorded with not just the banks that financed the deals but also with the county recorders office among others. To give you an idea of just how easy it is to build one of these cases, let's give ourselves five minutes online and see what we can come up with.


Let's start with Mr. Romney, at the very least we know that he ran the Bernardo Barrera mortgage fraud deal through a company he owned that was called "Property Collateral", let's run that through the Florida Division of corporations website to see if that's correct...

Bingo. Now we've confirmed that Mr. Romney did indeed own a company called Property Collateral Inc. Now consider that any deed, mortgage or quit claim deed that's filed in Miami Dade County has to be filed with the County Recorders Office, so let's go to their website and search to see what Property Collateral has been up to...

We find 23 recorded documents from our search of the County Recorders office, most interesting though is the item highlighted in yellow, a deed that was recorded on 8/3/10. That deed strikes me as strange, what kind of real estate transaction would Mr. Romney be conducting when he knows he's about to go to jail, especially when every move he makes is under close scrutiny by law enforcement? Let's pull up that deed and see what we find...

Uh Oh! Does anyone see the problem in those docs? If you can't, take another look and pay specific attention to the dates. Amazing how we were able to find all this in less than five minutes without a badge or subpoena powers or even a cooperating witness. We'll discuss in detail tomorrow...

And then there was none, the last of the original defendants from the Bernardo Barrera mortgage fraud case goes to jail...

As the title states, yesterday the last remaining defendant from the Bernardo Barrera mortgage fraud case, John Arthur Romney, entered his plea and was sent to jail.  I don't have the specifics of the plea yet, all we know is that the state dropped the organized scheme to defraud and the identity theft charges while Mr. Romney pleaded guilty to the Grand Theft charge.  I find that especially troubling, that of the three defendants originally charged with "stealing" Mr. Barrera's identity for the commission of this fraud, none were successfully prosecuted for Identity Theft.  What does that tell you?  Draw your own conclusions.

While I feel no joy in seeing a young man in the prime of his life being sent off to jail, I have some level of satisfaction that there was finally justice done in light of the dozens of other mortgage fraud cases that we've discussed where the state couldn't do better than getting a probation sentence for the offenders.  I honestly believe that with a stiff sentence (30 months in state prison from what I understand) for Mr. Romney, the state is sending a message to potential fraudsters, screw around with white collar crime and your ass will be going to jail.  I'd like to commend the State Attorneys Office for having the determination to stick it out and finally achieve a just outcome in light of the severity of the crime that was committed and also to congratulate Assistant State Attorney Stephen LeClair who took over the case from the previous prosecutor as well as the head of the recently formed Mortgage Fraud unit in the State Attorneys office, Assistant State Attorney David Sherman, for achieving this conviction.


Good luck Mr. Romney, I hope you have time to reflect on the damage you've done to yourself, your family and the others that you senselessly dragged into this mess.  I pray that you and your family are able to get through the next 30 months with as little suffering as possible.

What a coincidence!? Disbarred former Real Estate Attorney Jerry Velasquez gets charged for wire fraud!

How the hell did we miss this press release?!  From the U.S. Attorney's press release last August 10, 2010...

FOUR MIAMI DADE RESIDENTS, INCLUDING AN ATTORNEY AND THREE MORTGAGE BROKERS, CHARGED IN MORTGAGE FRAUD SCHEME

August 10, 2010
FOR IMMEDIATE RELEASE

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Henry Gutierrez, Postal Inspector in Charge, U.S. Postal Inspection Service, J. Thomas Cardwell, Commissioner, State of Florida Office of Financial Regulation, and Amos Rojas, Jr., Special Agent in Charge, Florida Department of Law Enforcement, announced the filing of a criminal Information against Jerry Velazquez, 38, of Miramar, Guillermo Moran, 38, of Miami Beach, Carolina Visbal, 32, of Miami Beach, and Rodolfo Landires, 37, of Miami. The one count Information charges the defendants with conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 1349. If convicted of this charge, the defendants face a maximum statutory penalty of up to twenty years’ imprisonment.

According to the allegations in the Information, the defendants sought to unlawfully enrich themselves by submitting to mortgage lenders mortgage loan applications and closing documents that contained false information. More specifically, defendants Moran, Landires, and Visbal, identified properties, usually condominium units, that were for sale in Miami-Dade County. They would then recruit straw buyers to purchase the condominium units at an inflated price. Thereafter, according to the Information, defendants Guillermo Moran, Rodolfo Landires, and Carolina Visbal submitted Uniform Residential Loan Applications (Form 1003); Request for Verification of Employment (Form 1005), Request for Verification of Deposit (Form 1006), and other documents containing false information to mortgage lenders in order to secure an inflated mortgage for the buyers/borrowers.

Defendant Jerry Velazquez, who at the time was a licensed attorney, participated in the scheme by handling the closings of the fraudulently procured loans. To execute the scheme, defendant Velazquez would, among other things, create two sets of closing documents, one which was given to the seller and reflected the true closing price, and another, which was sent to the lender and reflected the inflated sale price.

As a result of the false information in the mortgage applications and supporting documents, the lenders issued more than $6 million in mortgage loans.

Mr. Ferrer commended the investigative efforts of the U.S. Postal Inspection Service, State of Florida Office of Financial Regulation, and the Florida Department of Law Enforcement. This case is being prosecuted by Assistant U.S. Attorney Bertha R. Mitrani.

How's any of this a coincidence you ask?  We'll see soon enough.  In the mean time, take a look at the federal criminal information for Mr. Velazquez et all...

Jerry Velasquez Information

Amazing.  Later this week we're going to walk through another deal that Mr. Velasquez was involved in, one that's far worse than anything that he was charged for yet somehow never caught the attention of law enforcement.

Man sits in jail for 21 days before prosecutor realizes he's got the wrong guy.

As the title states, poor guys sits in a Miami Dade County jail for 21 days before the prosecutor realizes that he's got the wrong man behind bars.  If that wasn't enough, when the mistake was uncovered, the prosecutor refused to appear before the judge to explain himself!  Could this be possible?  Can anyone guess the name of the prosecutor responsible?   I'm working on getting all the details, I'll update as soon as possible.