Two previously convicted mortgage brokers have been indicted for using the identities of dead people to commit mortgage fraud. But neither has yet been apprehended.
Mark D. Musselman, 48, of Piqua, Ohio, and his alleged accomplice, Mark S. Edwards, 49, of Clayton, Ohio, were indicted for allegedly using phony information to secure more than $1 million in mortgages from InterFirst Mortgage Lenders, an Ann Arbor, Mich.-based unit of ABN AMRO Mortgage.
Musselman’s indictment included 59 felony criminal charges, while Edwards faces 48 charges, according to the Montgomery County Prosecutors office.
The criminal charges include engaging in a pattern of corrupt activity; aggravated theft of over $100,000; forgery; and tampering with records.
Musselman was also indicted on 11 counts of violating the Ohio Mortgage Broker’s Act.
The two are at large but warrants have been issued for their arrest, prosecutors said.
Musselman faces up to nearly 169 years in prison and fines of more than $392,000. Edwards faces up to nearly 160 years in prison and $365,000 in fines.
What puzzles prosecutors is that both men have previous felony convictions — Musselman for embezzlement, Edwards for drug and theft charges — yet were still able to get a license to operate Phoenix Funding Inc. in Vandalia, Ohio, a suburb of Dayton, Ohio.
The company has since closed.
“These defendants obtained fraudulent mortgage loans by submitting forged documents containing false and deceptive information, including forged real estate appraisals, loan applications and other documents,” Montgomery County Prosecutor Mat Heck Jr. said in a statement.
“Through their criminal activity they obtained dozens of fraudulent loans,” he said. “Twelve of these loans were on behalf of people who were actually dead at the time of the transactions.”
Musselman and Edwards “grossly inflated appraisals” so they could receive more money that the properties used in the scheme were actually worth, Heck said.
They then diverted the money to a “phony rehabilitation company … purportedly for making improvements to the” properties, Heck said.
“Those improvements never occurred,” he said. “All of the properties involved have been foreclosed upon and remain vacant.”
The alleged scam operated from the spring of 2003 to the winter of 2004.
Heck said the availability of vacant properties provided a ripe target for the pair.
“Having houses in our neighborhoods sitting vacant invites criminal activity, contributes to declining property values and is a blight on our communities,” he said.
