Property Manager Admits Role in Multi-Million-Dollar Mortgage Fraud
Arizona Free Press
← Back to
Other Stories
CAMDEN, NJ—A property manager has admitted to conspiring to defrauding financial institutions as part of a multi-million-dollar mortgage fraud scam that used phony documents and “straw buyers†to make illegal profits on over-developed condominiums in Wildwood, New Jersey.
Steven Schlatmann, 27, of Jersey City, New Jersey, plead guilty before U.S. District Judge Jerome B. Simandle in Camden federal court to an information charging him with one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering.
According to documents filed in this case and statements made in court:
Schlatmann and his conspirators identified homes in Wildwood and Wildwood Crest. Schlatmann’s conspirators recruited straw buyers to purchase those properties at inflated rates. The straw buyers had good credit scores but lacked the financial resources to qualify for mortgage loans. Schlatmann was aware that his conspirators created fraudulent loan applications that contained false information concerning the straw buyers’ employment, income, assets, and intended use of the properties. These actions were designed to make the straw buyers appear more creditworthy than they actually were in order to induce the lenders to make the loans.
Schlatmann and his conspirators caused fraudulent mortgage loan applications in the name of the straw buyers, including the supporting documents, to be submitted to mortgage brokers that the brokers knew were false. Once the loans were approved and the mortgage lenders sent the loan proceeds, Schlatmann’s conspirators took a portion of the proceeds, having funds wired or checks deposited into various accounts they controlled from the fraudulent mortgage loans or lines of credit on several properties. They also distributed a portion of the proceeds to other members of the conspiracy for their respective roles. For his part in the conspiracy, Schlatmann received $259,294 from four separate real estate transactions.
The wire fraud conspiracy charge is punishable by a maximum potential penalty of 30 years in prison and a $1 million fine. The conspiracy to commit money laundering charge is punishable by a maximum potential penalty of 10 years in prison and a $250,000 fine. Schlatmann’s sentencing is scheduled for March 24, 2014.