Husband, Wife Plead Guilty to Mortgage Fraud

KANSAS CITY, MO—Matt J. Whitworth, Acting United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., husband and wife pleaded guilty in federal court today to their roles in a mortgage fraud scheme.

Joseph Silvestro, 52, and his wife Julie Silvestro, 43, each waived their right to a grand jury and pleaded guilty before U.S. District Judge Ortrie D. Smith this afternoon to a federal information that charges them with conspiracy to commit bank fraud and wire fraud.

From February 2005 to September 2007, the Silvestros conspired with each other to defraud mortgage lenders and financial institutions by obtaining larger loans from lenders than the actual sale price associated with a particular property. These loans were based on material false and fraudulent representations, and by concealing material facts. Under the terms of today’s plea agreements, it is the government’s belief that the loss attributed to the Silvestros totals more than $567,000. The defendants have reserved their right to contest the amount of loss at their sentencing hearings.

The Silvestros admitted that they arranged for mortgage documents that often included payment of fictitious and fraudulent invoices to their company, Taylor Investments, Inc., as part of the settlement statement. Today’s plea agreements cite three properties in which the Silvestros fraudulently claimed invoices for Taylor Investments, ranging from $20,000 to $37,000. Those proceeds were deposited into the Taylor Investment bank account, but spent on personal expenditures by the Silvestros. Mortgage documents also falsely represented that a substantial cash down payment was being brought to the closing by the buyer.

By pleading guilty today, the Silvestros also agreed to forfeit to the government any property derived from the proceeds of the mortgage fraud scheme.

Under federal statutes, the Silvestros are each subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000 and an order of restitution. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.

This case is being prosecuted by Assistant U.S. Attorney David M. Ketchmark. It was investigated by the Federal Bureau of Investigation.