North Royalton Woman Charged in $460,000 Mortgage Fraud Scheme
| U.S. Attorney’s Office October 14, 2011 |
A 21-count indictment was filed against Antoinette Payne, 41, of North Royalton, Ohio, for her role in a $460,000 mortgage fraud scheme involving seven homes on the east side of Cleveland, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Payne was charged with one count of conspiracy to commit wire fraud, 14 counts of wire fraud, one count of conspiracy to commit money laundering, and five counts of money laundering in connection with a mortgage fraud scheme to defraud various lenders
The indictment charges that Payne was a loan officer licensed by the State of Ohio, and, as such, she had a fiduciary and contractual duty to the lenders to accurately prepare and process the mortgage loan applications and related documents related to the purchase of the properties.
As a licensed real estate professional, she was a Mortgage Broker and Loan Officer for Supreme Funding, a Mortgage Broker in Euclid, Ohio. The indictment also charges that Payne was the owner of TLC Properties (TLC) and Designer Loan Properties (Designer), which were simply sham companies which she used to receive kickbacks and reimbursements for undisclosed down payment assistance she was providing to purchasers from the various loans’ closings she was handling. These funds were in addition to the fees paid to Payne as a Mortgage Broker and Loan Officer in handling these transactions.
According to the indictment, as a part of this scheme, Payne would recruit purchasers for properties, promise to pay them money for filling out the paperwork for a mortgage loans where the price of the properties had been greatly inflated. She would also provide any down payments as necessary. To accomplish this, she sometimes would draw money out of her TLC bank account and purchase official checks made payable to the title company as purported down payments by purchasers.
Payne is also charged with falsifying the income and asset on the loan documents of the purchasers she recruited to ensure their approval. The indictment also charges that she would provide phony lists of improvements to the lender to support inflated the price of the real estate. The indictment charges that Payne sometimes would find purchasers for properties owned by R.L.W (not charged in the indictment). R.L.W. owned a company known as Rha Kha, LLC which purportedly was in the business of purchasing, fixing up, rehabilitating or “rehabing” older, neglected residential properties in order to sell these properties at fraudulently inflated prices through Payne. At times, Payne would direct title companies to issue checks to Rha Kha, LLC for purported work done on improvements to the properties. R.L.W. would endorse the checks, give them to Payne, who would deposit these checks in her TLC account.
The indictment charges that once the purchasers stopped making payments on the mortgage loans, the properties went into default, resulting in a loss to lenders in the amount of approximately $1 million.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt. If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney Christian H. Stickan, following investigation by agents of the Internal Revenue Service - Criminal Investigation and Federal Bureau of Investigation, Cleveland Office, with the assistance of the United States Department of Housing and Urban Development, Office of the Inspector General, in Cleveland, Ohio.