President of Beneficial Mortgage Corporation Ernesto Acosta Rodríguez and Six Others Indicted for Conspiracy to Commit Bank Fraud and Mail Fraud, Money Laundering Defendants Also Face a Criminal Forfeiture Allegation of $20.8 Million
|U.S. Attorney’s Office September 21, 2010|
SAN JUAN, PR—On September 17, 2010, a federal grand jury in the District of Puerto Rico returned a 49-count Indictment charging Ernesto Acosta Rodríguez, Mariluna Román Rodríguez, Samuel Cristy Llamas, Leishla Ramos Mateo, Yvonne Cleaver Normandía, José Blanco Hernández, and Emily Alvarado Santiago with conspiracy to commit bank fraud and mail fraud and with money laundering, announced United States Attorney for the District of Puerto Rico, Rosa Emilia Rodríguez Vélez.
The indictment alleges that from approximately November 2004 through February 2009, Beneficial Mortgage Corporation (“Beneficial”), acting through its management team, engaged in a complex scheme and artifice to defraud 7 FDIC insured banking institutions, 24 non-FDIC insured mortgage lenders, hundreds of consumers, and Banco Cooperativo of approximately $20.8 million.
During the entire period of time covered by the indictment, Beneficial was in the business of originating mortgage loans. As part of its business, Beneficial created pools of mortgage loans, totaling approximately 126 loans that it had originated and sold to investors in the secondary market, including Banco Cooperativo. After selling the loans to Banco Cooperativo, Beneficial continued to service the loans by collecting the monthly debt service payments owed and remitting those debt service payments to Banco Cooperativo in exchange for a lucrative servicing fee.
Months or years after Beneficial sold the loans to Banco Cooperativo (the “Beneficial Loans”), the respective debtors under the Beneficial Loans decided to either refinance their loans or sell their properties to buyers who, in turn, sought new mortgages over the properties. Under either scenario the Beneficial Loans were to be replaced by a new mortgage (the “New Mortgage”) that was issued by either an FDIC insured lending institution or a non-FDIC insured lending institution (the “New Lending Institution”). Upon closing on the transaction for the New Mortgages, the New Lending Institutions would send to Beneficial the pay-off amounts in order to fully satisfy the Beneficial Loans (the “Satisfaction Amounts”). Beneficial was then supposed to remit the Satisfaction Amounts to the true owner of the Beneficial Loans, Banco Cooperativo, in order to satisfy and cancel the Beneficial Loans. This payment would guarantee that the New Lending Institution would, as agreed, acquire a first mortgage over the property. In the case of the 126 Beneficial Loans, instead of satisfying the Beneficial Loans as represented, Beneficial kept the Satisfaction Amounts for its own use and fraudulently maintained the Beneficial Loans outstanding by continuing to remit to Banco Cooperativo the monthly debt service amounts as if the Beneficial Loans had never been satisfied. To maintain the scheme, Beneficial would then send the Borrowers and the New Lending Institutions letters that falsely represented that the Beneficial Loans had been fully satisfied when, in fact, they had not.
This deceptive practice had the effect of diluting the collateral that guaranteed the New Mortgages and jeopardizing the financial position of the New Lending Institutions. It also had the effect of subjecting the home owners and the properties to multiple debts and mortgages.
The leader of the conspiracy was Ernesto Acosta-Rodríguez, president and shareholder of Beneficial. He oversaw the daily operations of Beneficial and acted as Beneficial's primary representative in the execution of all contracts between Beneficial and Banco Cooperativo.
Defendant Mariluna Román-Rodríguez was an auditor for a private accounting firm who provided direct accounting and auditing services to Beneficial. In July 2004, she became Comptroller of Beneficial and remained in that position until March 2007. As Comptroller of Beneficial, Román-Rodríguez was primarily responsible for managing the Accounting Department, which included supervising the monthly remittances that were paid to Banco Cooperativo and which maintained the fraudulent scheme operating.
Defendant Samuel Cristy-Llamas was the Servicing Manager of Beneficial from January 2005 to the present, and as such, was responsible for receiving all monthly debt service payments and satisfaction amounts for the Beneficial Loans. CRISTY LLAMAS also signed and sent the New Lending Institution satisfaction letters and the escrow reimbursement letters to the clients.
Defendant Leishla Ramos-Mateo was a Customer Service and Escrow Analyst until September 2007. She was supervised directly by Cristy-Llamas and was in charge of recording the monthly debt service payments and the Satisfaction Amounts in Beneficial’s accounting system. Ramos-Mateo also prepared and submitted monthly reports to Banco Cooperativo that contained pertinent payment and loan balance information, and the amount of the monthly remittance for each of the loans (the “Monthly Remittance Reports”).
Defendant Yvonne Cleaver-Normandía was Beneficial’s Servicing Manager from March 2004 through December 2004. She was responsible for receiving all monthly debt service payments and all Satisfaction Amounts for the Beneficial Loans.
Defendant José Blanco-Hernández was an Accounting Clerk for Beneficial from September 2005 to the present. He was in charge of, among other things, maintaining a detailed spreadsheet of all debt service payments due each investor for whom Beneficial serviced loans, including Banco Cooperativo. The spreadsheet prepared by Blanco-Hernández was ultimately used in conjunction with the Monthly Remittance Reports to prepare the monthly remittance payments to Banco Cooperativo.
Defendant Emily Alvarado-Santiago was the Comptroller for Beneficial from approximately June 2007 until February 2009. She was primarily responsible for managing Beneficial’s accounting department and for making the monthly remittances to Banco Cooperativo.
“The fraudulent scheme charged in this Indictment is a clear example how the greedy acts of a few can serve to undermine the United States’ and Puerto Rico’s financial system,” said U.S. Attorney Rosa Emilia Rodríguez Vélez. “Mortgage fraud is a serious issue that affects not just financial institutions, but ordinary citizens who purchase, sell or refinance their homes only to find out later that their collateral is worth only a fraction of what they had originally thought. I want to assure the public that we will not rest until the tide of this criminal activity is turned. In the meantime, however, I urge all homeowners in Puerto Rico to play an active role in monitoring their ownership status over their properties. In other words, if you have never requested a title study AFTER purchasing, selling or refinancing your home, please consider doing so as it is through this type of diligent review that we can detect fraudulent mortgage schemes early before they get out of hand.”
President Obama established the Interagency Financial Fraud Enforcement Task Force (the Task Force”) to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. This Task Force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The Task Force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
If convicted, the defendants face a maximum term of imprisonment term of up to 30 years, fines of up to $1,000,000.00, or both.
The investigation was conducted by agents of the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigative Division, the United States Postal Inspection Service, the United States Secret Service and the Office of the Commissioner of Financial Institutions (“OCIF”). The case is being prosecuted by Assistant United States Attorneys Scott Anderson and Marshal D. Morgan.
Criminal indictments are only charges and are not evidence of guilt. A defendant is presumed to be innocent unless and until proven guilty.