Maria Del Carmen Montes, a real estate broker in Kissimmee, Florida, was sentenced to 33 months in federal prison for bank fraud.
According to court documents, Montes, working with her husband Carlos Ferrer and others, created and executed a mortgage fraud scheme targeting financial institutions. Montes assisted clients with purchasing homes and, after signing the real estate contract, referred her buyers to a loan officer at a mortgage company.
However, Montes’ some of the clients were not qualified for mortgages. As a result, she transferred the personal identifying and financial information of her clients to Ferrer and directed Ferrer to create fictitious paystubs and W-2s showing false earnings and length of employment for her clients. After Ferrer created the documents, Montes submitted the fictitious paystubs and W-2s to the financial institutions that made the underwriting decisions on the loans.
Montes was indicted in August 2022 and pleaded guilty in January 2024 to three counts of bank fraud. Last August, Ferrer was sentenced to four months’ imprisonment and ordered to serve three years of supervised release for his role in the case.
I was a real estate broker for 40 years in California. This kind of fraud has been around the industry from the beginning. Most competent mortgage brokers and bank loan officers know what to look for the combat the using of fraudulent documents. With computers and AI programs available today, the competent loan officer needs to take investigations to a higher level. Both in verifying genuine documents and and legitimate entities in their transaction.
The real estate broker and the guy who was apparently a mortgage broker were needless to say, not very wise or experienced. The bank officials only need to simply require the applicant to sign an IRS form 4506 which is submitted to the IRS for verification of income tax filing information and is a routine matter. The false income and employment information woud be immediately flagged.
Certain things are easier said than done. The IRS does not provide copies of tax returns
immediately when a 4506 form is submitted to them. Processing the 4506 form and
providing tax return transcripts or copies of the tax returns filed by the borrower can
take 4 to 8 weeks. But the loan needs to close in 2 to 4 weeks. Therefore, lenders often
do some of the due diligence after the closing but before they sell the loan to the investor.
More often than not, it is during the secondary due diligence process when discrepancies
in income stated by the borrower and the true income of the borrower is revealed. When
the lender discovers fraud, they would generally give the borrower a chance to explain.
Once the lender is convinced that the borrower has defrauded them, the file is turned for
lawful action and that’s what appears to have happened with these fraudsters.
“For Ever Thus”, says H C Hillcher Sr
I have discovered that my latest encounter with white collar fraud are checks used in an attempt to purchase someone’s advertised “for sale” asset.
I have been advertising in the Auto Trader my Classic Sports Car. So far, I have received five totally bogus checks for amounts exceeding the asking purchase price of the vehicle. The schema involves my refunding the fraudster the excess money more than providing the car.
Any one of these fake checks are drawn on real actual working businesses. The check is a perfect fraud right down to the water marks. Created by a very expert forger. I tell you about any teller in any bank would accept the check for deposit into your bank account without hesitation. They have all been perfect fakes, drawn on real business accounts, except the real businesses never issued the checks. Had I deposited any one as quickly as the fraudster insisted, I do, it would have taken the system 3 to 7 days to discover the check was fraudulent.
Just an aside. I always call the business the check is drawn upon first and verify it is fake or stolen. Calling the bank is useless because the bank will not comment on any of their own customers. Worse they will encourage you to deposit it immediately in the same manner as the crook who sent you the check. Pretty good scheme, but the crook has to act fast or be a fast talker and convince you to send him the overage to pay the transport company for moving the car.