That's an easy enough proposition, isn't it? When you're considering participating in some nefarious activity, go ahead and do a quick cost benefit analysis and determine if you can handle the jail time for the crime you're about to commit. Simple. I'm sure we've all posed that question to ourselves at some point or another, how much money would justify going to jail for? Maybe a million bucks? Perhaps half a million for a year behind bars? Who knows.
That's all well and good, at least 30 months behind bars is better than what almost all of the other fraudsters that the heralded Miami Dade County Mortgage Fraud Task Force prosecuted got, we were unable to find anyone that got anything more than probation despite millions of dollars worth of fraud that they were found guilty of! No worries, at least the state got Mr. Romney's case right, that is until a couple of nights back when I was checking in on Mr. Romney's whereabouts in the state prison system. From his department of corrections page...
The department of correction's page states that Mr. Romney is at the Opa Locka W.R.C. and that his "Current Custody" is "community". I did a little digging and found out that "W.R.C." stands for "Work Release Center". WTF?!
Isn't that wonderful? Mr Romney is out on the street! He gets to run around all day then come back to a tax payer funded bed at night! SWEET!!!
So is that it? Admit to stealing nearly $400k and all you get is less than 10 months behind bars? Let's go back to the title of today's post...
"Don't do the crime if you can't do the time..."
With that in mind, let's do a quick cost benefit analysis. Let's assume that he stole $400k and that he was behind bars for exactly ten months for ease of calculation. That works out to $40k per month or approximately $1,300 per day. How many of you guys our there are making $1,300 per day? Considering our current economic climate, I'd venture to guess that not many of us are doing so. Remember, this doesn't even take into consideration the other real estate/mortgage frauds that Mr. Romney has admitted to. Add those numbers in and his average take per day could go up ten fold.
I'll leave you with this, do you guys believe nine months behind bars was an adequate punishment for defrauding a bank out of $400k? $40k per month while being fed and clothed by the state doesn't seem like such a bad deal after all, does it?
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!
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.
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.
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.
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...
Did anyone understand the significance of the realtors statement in Tuesdays post? In case you missed it, we had tracked down and spoken to the realtor who represented Maxine Andrews (the little old widow) in the sale of the home located at 3390 Oak Avenue to John Arthur Romney who later used the home as the vehicle with which to defraud Citi Mortgage for nearly $400,000. In her discussions with Mr. Romney, he advised that he wanted to buy more homes in the area and that he was trying to buy the home across the street from Maxine's. So what's the deal with the home across the street from Maxine's? Could he have been referring to 3379 Oak Avenue?
Or maybe he was referring to 3375 Oak Avenue?
Both located across the street, both involved in massive mortgage fraud schemes and consequently both are currently in foreclosure. Coincidence? Maybe. But what about that other statement about "wanting to buy more homes in the area"? Could he have been referring to the other homes in west Coconut Grove that were involved in millions of dollars worth of mortgage fraud? Maybe like the ones that we discussed in the past (here, here and here)?
So what do we got? Was this conversation between the realtor and Mr. Romney just an instance of Mr. Romney running his mouth or a Freudian slip admitting to other mortgage frauds that he and or his associates were involved in? While we have no proof of Mr. Romney being directly involved in these other mortgage frauds, by his own admission he certainly had knowledge of them and who was behind them, more on that later. In the mean time, we'll be discussing another botched mortgage fraud case courtesy of ASA Bill Kostrzewski and we'll discuss the worlds worst forged check case.
We mentioned last week that we had sought out people involved in the Barrera mortgage fraud and asked them a few questions regarding the home located at 3390 Oak Avenue which was used by John Arthur Romney to defraud Citi Mortgage out of nearly $400,000. The first person that we decided to track down was the realtor who sold Mr. Romney the home for $185,000 which he later flipped to Mr. Barrera or someone posing as Mr. Barrera for $600,000. After digging through the records we found that the realtor was one Betty Wilburn.
Betty tells us that her client was Maxine Andrews, the little old lady that sold the home to John Romney, Maxine's husband had died and she remained at the house on Oak Avenue after his death. The property was listed through Mrs Wilburn and was appraised at approximately $300,000; however Maxine was fed up and tired of being in that area. Maxine was anxious to leave the area which she subsequently did and moved up north. Fair enough. She went on to say that a man named John Romney whose name she recalled because of the similarity to then presidential candidate Mitt Romney came by to visit Maxine regarding her home. Maxine subsequently contacted Betty and stated that a man named John had knocked on her door and said that he would buy the house for cash. John (Romney) offered Maxine $185,000 for her home, Betty tried to convince Maxine not to accept the offer since the home was appraised for more but Maxine insisted that she wanted to sell the house and get out of town and that after being on the market for nearly a year, this was the only offer they had ever received on the home. Otherwise Maxine said that she would abandon the house and let it go into foreclosure.
So far so good right? Nothing earth shattering here, widow wants to sell her house in a bad area and get out of dodge, there's a buyer standing at the door with $185,000 in cash and the realtor wants the seller to hold out for more money. Here's were it gets good, Mrs. Wilburn recalls having a conversation with John Romney during which time he advised that he wanted to buy more homes in the area and that he was trying to buy the home across the street from Maxine's.
I read a story in the Miami Herald on October 7, 2008 regarding a mortgage fraud case that didn't make any sense to me, I did a little digging and what I found left me stunned. A tale of a task force head whose political ambitions have run amuck, a detective without a modicum of common sense, a reporter that prints anything that's put in front of him, the railroading of an attorney by this machine to further the ambitions of its head and the lengths that those involved will go to in order to salvage a case that should have never been. Please take the time to start from the oldest post first and enjoy...
