Florida Man to Serve 13 Months for Defrauding Thousands of Homeowners in $4 Million Home Loan Modification Scam
BOSTON – February 27, 2014 – (RealEstateRama) — A Florida man was sentenced today to serve 13 months in prison for defrauding thousands of homeowners in a $4 million nationwide home loan modification scheme.
United States Attorney Carmen M. Ortiz, Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, and Special Inspector General for the Troubled Asset Relief Program (SIGTARP) Christy Romero made the announcement.
Vernell Burris Jr., 54, of Coconut Creek, Fla., was sentenced by U.S. District Court Judge Rya W. Zobel and ordered to serve two years of supervised release following his prison term. Two co-defendants, Christopher S. Godfrey, 44, of Delray Beach, Fla., and Dennis Fischer, 42, of Highland Beach, Fla., were each sentenced on Feb. 20, 2014, to serve 84 months in prison and three years of supervised release following their prison term.
On Nov. 28, 2012, Burris pleaded guilty, to conspiracy and nine counts of wire fraud.
Burris worked for Godfrey and Fischer, initially as a salesman and later as the sales manager. From January 2009 through May 2011, Burris, along with Godfrey, Fischer and others, operating under the name Home Owners Protection Economics Inc. (HOPE), made a series of misrepresentations to induce struggling homeowners to pay HOPE $400 to $2,000 in up-front fees in exchange for HOPE’s help obtaining federally-funded home loan modifications. The scheme generated over $4 million in revenues.
The conspirators misrepresented that, with HOPE’s assistance, the homeowner was guaranteed to receive a loan modification under the Home Affordable Modification Program (HAMP), which is part of the Troubled Asset Relief Program (TARP) and is a federally-funded, mortgage-assistance program. For example, the defendants routinely claimed that the homeowner had already been approved for a loan modification, provided phony “approval codes,” quoted new (and wholly fictitious) mortgage terms and due dates, touted their 98 percent past success rate and claimed that they were “underwriters” or were otherwise affiliated with the homeowners’ mortgage companies. HOPE also claimed that it would offer homeowners refunds in the unlikely event that they did not receive a loan modification.
In exchange for the up-front fees, HOPE sent its customers, including homeowners in Massachusetts, a do-it-yourself application package, which was virtually identical to the application that the government provides free of charge. The HOPE customers had no advantage in the application process, and, in fact, most of their applications were denied. Through these misrepresentations, HOPE was able to persuade thousands of homeowners to pay more than $4 million in fees.
The remaining defendant in the case, Brian Kelly, has pleaded guilty and is awaiting sentencing.
The case was investigated by SIGTARP, and is being prosecuted by Assistant U.S. Attorney Adam Bookbinder of Ortiz’s Computer Crimes Unit and Senior Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section.