Three mortgage fraud cases out of New Jersey — one involving a former mayor, another involving a mob accountant and a third involving a reality TV star — are the stuff of movies.
In December 2009, Andrew Lucas and a relative presented an application to finance the purchase of a farm in Manalapan, N.J.
Lucas, 37, sought a mortgage in the amount of $525,000, and he submitted a loan application to a bank located in the Garden State.
But Lucas, who was the former mayor of Manalapan, didn’t have enough income to qualify for the loan, nor did he have enough money for the downpayment.
So, according to the U.S. Department of Justice, Lucas and the co-borrower provided the lender with fake tax returns that did show adequate income.
In order to come up with the downpayment, he asked a client, Bobby Janowski, to invest $250,000 in VLM Investments LLC. However, unbeknownst to Janowski, VLM did not exist at that point. Then Lucas allegedly filed tax returns for VLM using the name and social security number of Thomas Littlefield, a relative who knew nothing about VLM.
When federal investigators subpoenaed Lucas in February 2013, he allegedly provided fake documents on VLM.
On Thursday, the Justice Department said that Lucas was found guilty in U.S. District Court for the District of New Jersey on 11 counts. He is scheduled to be sentenced on Jan. 20, 2015.
On Friday, the Justice Department said that Howard Drossner was sentenced to 40 months in prison.
Drossner, 53, was a certified public accountant who allegedly conspired with Nicodemo S. Scarfo — a made member of the Lucchese La Cosa Nostra organized crime family — to extort funds from FirstPlus Financial Group Inc.
He also created fake tax returns for Scarfo’s fiancé to obtain a $500,000 mortgage to purchase a $715,000 Egg Harbor, N.J., home in February 2008. The downpayment came from funds extorted from FirstPlus.
But when FirstPlus was shut down by federal law enforcement officials in May 2008, Scarfo was unable to make the mortgage payments, and the property was foreclosed.
Drossner previously pled guilty in a New Jersey federal court.
The Real Housewives of New Jersey star Teresa Giudice and her husband Giuseppe “Joe” Giudice pled guilty in March to mortgage fraud, among other things.
The Giudices are accused of submitting fraudulent mortgage applications to banks from September 2001 through September 2008. The applications and supporting documents reflected fake employment and income.
Two loans, one for $121,500 and another for $361,250, were cited by the government.
“Teresa and Giuseppe Giudice used deception and fraud to cheat banks, bankruptcy court and the IRS,” U.S. Attorney Paul J. Fishman said in the March statement. “With their guilty pleas, they admitted the schemes with which they were charged. Having now confessed their wrongdoing, the Giudices face the real cost of their criminal conduct.”
While sentencing for the pair was originally scheduled for July 8 in U.S. District Court for the District of New Jersey, it has been postponed until Oct. 2.
