INDIANAPOLIS — A taste for money, luxury cars, and drugs has cost the owner of an Indianapolis mortgage company his business and his freedom.
Jeffrey Neely, 34, the owner of Investors Mortgage Group in Indianapolis, has been sentenced to more than 14 years in federal prison for his role in a $2.5 million mortgage fraud scheme, according to Susan Brooks, United States Attorney for the Southern District of Indiana.
Neely was indicted Sept. 6 with six other defendants in a mortgage fraud and money laundering conspiracy involving inflating property values in order to obtain an estimated 75 fraudulent loans, Brooks said in a statement.
With extraordinary candor Neely admitted to a judge that a fast-lane lifestyle was his downfall.
“I was wrong in what I did,” Neely told U.S. District Judge Larry McKinney during his sentencing, according to the Associated Press. “I allowed myself to be caught up in the trappings of money, drugs even.”
Brooks said Neely used the fraudulently obtained mortgage loans to purchase luxury cars, including a $140,000 Porsche and a Mercedes. The vehicles, along with $94,000 from a bank account in Neely’s mother name, were seized during the government’s year-long investigation, Brooks said.
“The (federal) Mortgage Fraud Task Force is well on its way to accomplishing the goals of the task force,” Brooks said. “We are educating the public, bringing participants of fraud schemes to justice and hopefully deterring future fraud. Jeffrey Neely’s sentence sends this message loud and clear.”
Joining the U.S. Attorney’s office in the investigation were the FBI and Internal Revenue Service.
Neely has been barred from working in the mortgage lending or title business, was ordered to pay $2.055 million in restitution and faces three years of supervised probation following his release from prison, said Assistant U.S. Attorney Donna R. Eide, who prosecuted the case.
According to prosecutors Neely “was the leader and organizer of the criminal activity who recruited other persons to assist in the scheme, including closing agents, appraisers and investors.”
He and others would receive bogus mortgage loans by turning over inflated appraisals to lenders. The loans were obtained from July 1999 to June 2002 on residential properties in Indianapolis.
Five of the others indicted are scheduled to go on trial July 21.
When Neely was unable to persuade real estate appraisers to inflate property values he would forge appraisals using the name and license number of an appraiser he had previously worked with, Brooks said.
Properties were appraised for as much as 15 times their true value, she said.
Nearly all of the loans went into default, costing lenders approximately $3 million, the government said.
