Guilty Verdict in $7.5 Million Mortgage Fraud Scam

After deliberating for four days, a jury in federal court in Ann Abor, Michigan, returned a guilty verdict against Tom Gjokaj, 54, of Sterling Heights, for bank fraud following a six-week trial, United States Attorney Barbara L. McQuade announced today. McQuade was joined in the announcement by FBI Special Agent in Charge Andrew C. Arena. The Honorable John Corbett O’Meara set Gjokaj’s sentencing date for October 18, 2011.

The jury could not reach unanimous verdicts against co-defendants James Wiese, 40, of Birmingham, or Ilir Dokaj, 35, of Sterling Heights, who were charged with Gjokaj, or against any of the three men on charges of conspiracy to commit federal crimes and money laundering. The jury acquitted all three men of wire fraud. The government announced that it plans to re-try Wiese and Dokaj on charges of conspiracy and bank fraud, and against James Wiese alone for money laundering.

The evidence admitted at trial established that in the spring of 2007, Tom Gjokaj, an unemployed house painter, obtained $7,557,100 from fraudulent first and second mortgages on twelve Birmingham homes built by James Wiese, owner of Great Lakes Custom Builder, LLC, and Great Lakes Roofing. The first fraudulent loan closed on May 11, 2007, and the twelfth and final loan closed on August 13, 2007. Gjokaj paid Wiese’s 2005 asking prices for all twelve properties, for a total of $8,313,000.

At the beginning of the scheme, buyer Tom Gjokaj’s personal credit rating was over 700, which qualified him to apply for Stated Income / Stated Asset loans, or Stated Income / Verified Asset loans. On the mortgage loan applications (1003s) for each of the properties, Gokaj, who was receiving unemployment checks for $362 a week until March 2007, falsely listed his monthly earnings as more than $17,000. Gjokaj also failed to disclose all of his liabilities (including those related to the properties he purchased when the scheme began), and made other material misrepresentations.

All of the mortgages went into default.

The case was investigated by special agents of the FBI, and prosecuted by Assistant U.S. Attorneys Cynthia Oberg, Erin Shaw and Julie Beck.