Lending The Ticker

Feds seek fugitive who fled after being convicted in $16 million mortgage fraud scheme

Oscar Ortiz charged with failing to appear for sentencing

Police cars

Nearly a year ago, Oscar Ortiz, a 53-year-old contractor from the Houston area, pleaded guilty to conspiring to commit bank, mail and wire fraud for his role in a $16 million mortgage fraud scheme.

Ortiz was due in court this week to receive his sentencing for that conviction, but when his sentencing hearing began, Ortiz was nowhere to be found.

And now the Federal Bureau of Investigation is searching for him.

According to the U.S. Attorney’s Office for the Southern District, Ortiz now stands charged with failing to appear and is considered a fugitive.

Ortiz’s original conviction stems from a mortgage fraud scheme in which he and a conspirator, Houston Realtor Seung Min Santillan, recruited straw borrowers to purchase residential properties in the Houston area.

As part of the scheme, Ortiz and Santillan obtained mortgages from lenders to purchase properties using the names and credit of the straw borrowers.

According to the U.S. Attorney’s Office, Ortiz and Santillan provided the lenders with “materially false information” to convince them to fund the residential loans.

Ortiz and Santillan used several business entities as part of the scheme including Uptown Builders, Americorp Builders, Luxury Quality Homes and Santi Investments.

To get the straw borrowers to participate in the scheme, Ortiz and Santillan told them that the property would be in their name for only a short period of time while Ortiz made modifications to the property, before reselling the house.

Ortiz and Santillan also promised the straw borrowers that they would handle all the costs associated with purchasing and holding the properties.

Once the loans to purchase the residence in question funded, one or more of the business entities Ortiz used would receive a large portion of the loan proceeds.

According to the U.S. Attorney’s Office, this also occurred even when the same property was purchased for a second time in the name of a new straw borrower.

Court documents showed that Ortiz and Santillan were able to keep a large portion of the loan proceeds since the value of the residence had been inflated with fraudulent appraisal reports.

Last year, Santillan pleaded guilty to the conspiracy and making false statements on a loan application. And earlier this month, she was sentenced to 168 months in federal prison and ordered to pay $5,299,500 in restitution.

Ortiz, however, still remains at large with the FBI on the hunt for him.

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