Owner of Multiple Real Estate Companies Pleads Guilty to Two Mortgage Fraud Conspiracies Involving More Than $20 Million
|U.S. Attorney’s Office May 09, 2013|
TAMPA—United States Attorney Robert E. O’Neill announces that Oscar Torres (47, Weston) pleaded guilty today to participating in two separate mortgage fraud conspiracies. He faces a maximum penalty of 30 years in federal prison on each of the two counts.
According to the plea agreement, Torres was the owner and operator of a real estate business called Realty Alliance LLC and a mortgage brokerage company called Synergy Lending Group. In addition, Torres was the co-owner of a title agency called Title Executives of Broward Inc. In or about 2005, Realty Alliance, Synergy Lending, and Title Executives (“Torres Companies”) were all consolidated in the same business location in Weston, Florida. These real estate businesses operated throughout Florida.
The first conspiracy began in June 2006 and continued through April 2007. Torres conspired with others to execute a scheme to defraud various financial institutions. The ultimate goal of the fraud scheme was to sell condominium units at The Arbors at Carrollwood, a 390-unit condominium complex located at 3939 Ehrlich Road in Tampa. During the time frame of the conspiracy, The Arbors was in the process of being converted from an apartment complex into a condominium complex.
Torres and his co-conspirators directed their fraudulent activities at Corus Bank, N.A., and a variety of FDIC-insured and non-FDIC insured mortgage lending businesses (the “mortgage lenders”) for purposes of influencing them to approve millions of dollars in mortgage loans. In June 2006, the developers hired the Torres Companies to sell condo units at The Arbors. To entice buyers to purchase the condo units, the conspirators offered unlawful cash payments to buyers, either before or after closing. These cash payments were concealed from the lenders that were funding loans to individual buyers.
To induce mortgage lenders to approve loans for the purchase of condo units at The Arbors, the conspirators made material misrepresentations and omitted material facts from purchase and sale agreements, Uniform Residential Loan Applications, and on the HUD-1 Settlement Statements. The false and fraudulent statements included the property’s actual purchase/sale price; the buyer’s intended use of the property; the buyer’s employment, gross monthly income, assets, liabilities, and bank account balances; the source of down payments and closing costs; and/or the actual disbursement of the loan proceeds at the closing. As a result of these false and fraudulent statements, Torres and his co-conspirators caused and induced the mortgage lenders to fund millions of dollars in mortgage loans. Ultimately, these mortgage lenders sustained a loss of more than $15 million as a result of this mortgage fraud conspiracy.
The second conspiracy began around the summer of 2006 and continued through about March 2007. Torres conspired with others to execute a scheme to defraud various financial institutions in connection with the sale of condominium units at The Preserve at Temple Terrace, a 392-unit condominium complex located at 7735 Fletcher Avenue, in Temple Terrace. During the time frame of the conspiracy, The Preserve was also being converted from an apartment complex into a condominium complex. The Preserve hired the Torres Companies to sell condo units at the complex.
Torres and his co-conspirators marketed the condo units at The Preserve with a series of “buyers incentives,” including a rental income guarantee, property management at no additional cost, payment of homeowner’s association fees, limited escrow deposit due at closing, and a three percent closing cost credit. In reality, the conspirators enticed buyers by offering cash payments. For each transaction, the enticements amounted to thousands of dollars paid in cash to buyers before and after closing. These payments to buyers amounted to more than $1 million in undisclosed cash incentives. The conspirators intentionally and fraudulently concealed these cash payments from the lenders through the use of a shell company called Capital Property Investments LLC.
Torres and his co-conspirators again made false and fraudulent statements on various mortgage-related documents. In this scheme, the mortgage lenders who financed the purchase of condo units at The Preserve sustained a loss of approximately $5.6 million.
This case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Simon Gaugush.