Fraudulent Rescue / Equity Skim Scheme Costs Dozens Over $6.2 Million

By on November 16, 2011
Fraudulent Rescue / Equity Skim Scheme Costs Dozens Over $6.2 Million

Between 2006 and 2008 real estate agent, Joanne Seeley, defrauded 34 homeowners and 14 mortgage companies in Pennsylvania out of more than $6.2 million in a fraudulent Foreclosure Rescue/Equity Skim scheme. Seeley was found guilty earlier this month on four counts of wire fraud and four counts of money laundering; each punishable by a maximum 20 years in prision and a $500,000 fine.

Seeley was a Pennsylvania licensed real estate agent until December 12, 2006, when she permanently surrendered her license in lieu of disciplinary action. Thereafter, in the Fall of 2007 Seeley became the primary owner and operator of a business in East Berlin known as S&D Property Solutions (S&D).

Seeley would identify a residence scheduled for Sheriff’s Sale and advise the homeowner he/she could avoid foreclosure by selling the home to her or one of her investor/buyers, who would then lease the property back to the homeowner after the sale.

Seeley assured the homeowner the sale would allow them to pay off their personal debts, rebuild their credit rating, and allow them to qualify for a new mortgage when they bought back the home one year later. Seeley also promised the homeowners that any equity they had in the house would be held in escrow by the buyer after the sale as the seller’s down-payment.

Seeley recruited and induced several Investor/ Buyers into participating in her program by assuring them they would be reimbursed for all out-of-pocket expenses, including their down payment an $8,000 “fee” for engaging in the transaction after the closing.

Seeley also promised the buyers they would receive monthly rent from the homeowner that would cover most, if not all, of their mortgage payments. Some buyers were also promised an up front payment designed to make up the difference between their mortgage payments and the rent they received.

Seeley submitted a plethora of false documents to the mortgage lenders in order to induce them into approving unqualified buyers’ loan applications. The false documents included false employment verifications, false leases, false rental income, and false occupancy verifications.

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Seeley also submitted redacted sales contracts to the lenders that concealed the fact the buyer and seller had entered into buy-back agreements and the buyer’s down payment was refunded to the buyer from the loan proceeds.

The trial showed that Seeley converted a significant portion of the $6.2 million in loan proceeds, approximately $2.3 million, to her own use.

Prior to the surrender of her license Seeley would charge the distressed homeowner an extremely high commission ( as much as 40-47%) equal to the homeowner’s equity in the property. Later, Seeley would simply have the homeowners sign over their entire sales proceeds checks to S&D Property Solutions.

Contrary to what the homeowners were promised, no funds were ever escrowed on their behalf. Instead, Seeley spent the money on her personal expenses and no homeowner was ever able to buy their home back – Source.

Greed is a hell of a drug.


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