Seven California residents now face federal charges for their roles in an alleged mortgage fraud scheme that defrauded lenders of more than $3 million.
After an investigation that involved Christy Romero, Special Inspector General for the Troubled Asset Relief Program; Benjamin Wagner, United States Attorney for the Eastern District of California; Wade Walters, Special Agent in Charge of the Federal Deposit Insurance Corporation Office of Inspector General; Birgit Fladager, Stanislaus County District Attorney; and Leslie DeMarco, Special Agent in Charge of the Federal Housing Finance Agency Office of Inspector General, a federal grand jury returned a 15-count indictment last week against seven residents of California, charging them with conspiracy to commit mail fraud and bank fraud, mail fraud and aiding and abetting, and making false statements to a bank in a mortgage fraud scheme.
According to court documents, the defendants conspired to defraud mortgage lending companies and financial institutions by making false statements on loan applications and short-sale applications in order to obtain properties under their names and the names of others.
SIGTARP said that the false statements included claims relating to the defendants’ employment, their familial relationship, income and their intent to occupy the home as their primary residence.
The indictment showed that the scheme involved at least 25 properties from Sacramento to Modesto. As a result of the scheme, lenders lost more than $3 million.
According to SIGTARP, Jyoteshna Karan, 43, and Praveen Singh, 36, were arrested Friday at their home in Modesto. Mahendra Prasad, 53, was also arrested Friday at his home in Fremont. The remaining defendants, Phul Singh, 79, and Sunita Singh, 60, both of Modesto; Nani Isaac, 69, of Ceres; and Martin Bahrami, 42, of Turloc, each received a summons to appear for arraignment.
“Early this morning, SIGTARP agents and our law enforcement partners arrested or served summons on seven individuals who stand charged with operating a fraud scheme that cost financial institutions, including multiple TARP banks, millions of dollars in losses,” said Romero.
“The seven allegedly conspired to falsify information on mortgage loan and short-sale applications submitted to multiple financial institutions in order to obtain properties across Eastern California,” Romero continued. “SIGTARP and our law enforcement partners will aggressively investigate allegations of fraud perpetrated at the expense of taxpayers’ TARP bank investments and bring accountability to those who engage in these schemes.”
According to SIGTARP, each defendant faces a maximum statutory penalty of 30 years in prison and a $1 million fine per count.