Michael David Scott will also serve five years of supervised release, and has been forced to pay over $11.3 million in restitution. He will also have to surrender $7.4 million in ill-gotten funds, according to Banker & Tradesman.
Between September 2006 and April 2008, Scott arranged purchases of residences and sold condo units to straw buyers, according to court documents. Scott and his co-conspirators, Jerold Fowler and Thursa Raetz, allegedly told buyers they would receive profits from the units and that they didn’t have to pay any mortgage payments, provide down payments, or pay funds at closing.
The three allegedly submitted loan applications with fraudulent information to nine different mortgage lenders and a local bank.
Scott pleaded guilty to 32 counts of wire fraud in June, as well as 14 counts of bank fraud and 22 counts of money laundering.
Local real estate lawyer Stuart Schrier told the Boston Globe at the time that Scott’s ploys had a negative impact on various Boston neighbourhoods.
“He destroyed the neighborhood,” Schrier said at the time. “He could afford to overpay because he was flipping them for so much, so he drove up the prices and pushed honest buyers out of the market.”
Raetz and Fowler both pleaded guilty to two wire fraud charges in June. Fowler will be sentenced November 19; Fowler will be sentenced November 20.
A former developer and Realtor has been sentenced to 135 months in prison for various mortgage schemes.