A trio of real estate professionals in California’s Bay Area were sentenced for their roles in a $55 million mortgage fraud conspiracy case.
According to the charges brought against them, Tjoman Butalim of San Francisco was a licensed real estate broker until his license was revoked in 2019. Between 2018 and 2022, Butalim conspired to originate approximately 102 home loans worth more than $55 million based on false and fraudulent loan application information. Buditaslim obtained home loans for his clients, potential homebuyers, by submitting false loan applications and income information to multiple loan companies.
Unbeknownst to the applicants, Buditaslim created fraudulent documents, including judicial divorce decrees, alimony and child support checks for nonexistent children, bank statements, and loan applications, that falsely inflated the applicants’ income. The loan companies extended home loans to Buditaslim’s clients relying on the falsely inflated income information.
Buditaslim and his co-conspirators – real estate agent Jose De Jesus Martinez of Daly City and mortgage company loan officer Jose Alfonso Tellez of San Jose – profited from the conspiracy via payments from escrow when the clients purchased homes or direct payment from the clients. Buditaslim admitted that the Federal Housing Administration (FHA), which insured many of the fraudulently obtained mortgage loans, lost approximately $486,484.38 to keep certain of the loans from going into foreclosure.
According to Martinez’s plea agreement, he directed clients to Buditaslim knowing that Buditaslim would qualify his clients for home loans based on false and fraudulent loan application materials and information. Buditaslim obtained approximately 49 loans for Martinez’s real estate clients totaling about $27.7 million. As the agent for the buyers, Martinez earned nearly $590,000 in real estate broker commissions.
Tellez helped originate approximately 30 home mortgage loans worth more than $17 million based on what he knew to be false and fraudulent income information. Despite knowing that he was required to stop and flag applications based on false and fraudulent income representations, Tellez knowingly assisted in originating and funding the loans. Tellez earned more than $134,000 in commissions on the 30 fraudulently obtained loans.
“The defendants tried to line their own pockets at the expense of homebuyers, lenders, and federally insured programs – Instead of helping potential homebuyers obtain home loans for which they were qualified, defendants chased loans that should never have been extended,” said US Attorney Ismail J. Ramsey. “Today’s sentences hold the defendants accountable for their conduct.”
Butalim was sentenced to 24 months, while Martinez was sentences to 14 months, and Tellez received a sentence 12 months in prison. A fourth defendant, Travis Holasek, will be sentenced at a later time. All four defendants pleaded guilty to conspiracy to commit wire fraud.
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