TRENTON
– Attorney General Jeffrey S. Chiesa
announced that a lawyer and an investment
broker from Monmouth County have pleaded guilty
for their roles in a scheme to steal more
than $2.6 million from lenders by filing fraudulent
mortgage loan applications.
The
lawyer, Mark J. Bellotti, 55, of Marlboro,
pleaded guilty yesterday to second-degree
charges of conspiracy and theft by deception
before Superior Court Judge Anthony J. Mellaci
Jr. in Monmouth County. Under his plea agreement,
the state will recommend that Bellotti be
sentenced to five years in state prison
and be ordered to pay a fine of $100,000.
The
broker, Jonathan P. Domash, 41, of Marlboro,
owner of Diversified Assets, LLC, pleaded
guilty yesterday to a charge of third-degree
theft by deception. Under his plea agreement,
the state will recommend that Domash be
sentenced to 364 days in jail and five years
of probation.
In
pleading guilty, Bellotti and Domash admitted
that they conspired to falsify mortgage
loan applications to cause banks to provide
loans to unqualified home buyers. The two
men were charged in an April 11, 2011 state
grand jury indictment stemming from an investigation
by the Division of Criminal Justice Financial
& Computer Crimes Bureau. Deputy Attorney
General Valerie A. Noto took the guilty
pleas for the Division of Criminal Justice.
“These
defendants exploited all parties to these
fraudulently arranged mortgage loans, dooming
unqualified home buyers to foreclosure and
lenders to major losses, while they ran
off with enormous fees,” said Attorney
General Chiesa. “With these guilty
pleas, we are putting these con artists
behind bars, where they belong.”
“We’re
aggressively targeting financial fraud,
which is particularly destructive during
this time of economic turmoil, when many
are vulnerable and may jump too quickly
at a chance to get ahead,” said Stephen
J. Taylor, Director of the Division of Criminal
Justice. “We urge investors to use
caution and report suspicious schemes to
us.”
The
indictment charged Bellotti and Domash in
connection with seven mortgage loans totaling
$2,671,400. A third defendant named in the
indictment, Leonardo A. Hernandez, 40, of
Hillsborough, pleaded guilty yesterday to
an amended count of the indictment charging
theft by deception as a disorderly persons
offense. He admitted that he submitted false
information and documents in connection
with several of the loans. Hernandez faces
a sentence of probation. Charges remain
pending against three other individuals
who were charged in the indictment for allegedly
assisting Bellotti and Domash. Additional
defendants may also face charges.
Judge
Mellaci scheduled sentencing for Bellotti
and Domash for July 13, and scheduled sentencing
for Hernandez for April 5.
The
investigation revealed that Domash, Bellotti
and Hernandez falsified information about
employment, earnings and bank account balances
on mortgage loan applications so that home
buyers could obtain loans for which they
were not qualified. They also falsified
U.S. Department of Housing and Urban Development
(HUD) settlement forms.
The
defendants submitted fraudulent loan applications
and HUD documents between April 2006 and
June 2007 to obtain mortgage loans in the
following amounts for seven homes in these
locations: Hillsborough ($540,000), Plainfield
($342,000), Marlboro ($339,150), Keansburg
($351,500), Asbury Park ($384,750), Asbury
Park ($374,000), and Newark ($340,000).
The
investigation revealed that Domash would
find homeowners who were eager to sell,
and then convince buyers to invest in the
homes as income properties through his company,
Diversified Assets, LLC. He had buyers sign
blank loan applications, so he and other
defendants could falsify the buyers’
personal financial information. Bellotti
handled the closings for the home sales,
performing separate closings with the buyers
and sellers. The defendants inflated the
sales prices for the properties and took
out huge fees at closing from the loan proceeds.
All of the homes ultimately fell into foreclosure,
and some purchasers had their credit ruined.
Deputy
Attorney General Noto presented the case
to the state grand jury. The investigation
was conducted and coordinated for the Division
of Criminal Justice Financial & Computer
Crimes Bureau by Detective Kimberly Allen,
Deputy Attorney General Noto, and Supervising
Deputy Attorney General Terrence Hull, Chief
of the Financial & Computer Crimes Bureau.
Attorney
General Chiesa and Director Taylor noted
that the Division of Criminal Justice has
established a toll-free tipline 1-866-TIPS-4CJ
for the public to report corruption, financial
fraud and other illegal activities. Additionally,
the public can log on to the Division of
Criminal Justice Web site at www.njdcj.org
to report suspected wrongdoing. All information
received through the Division of Criminal
Justice tipline or Web page will remain
confidential.
### |