Fraudulent short-sale scheme lands loan officer in prison

Under the scheme, purported sellers remained in their homes with their debt substantially reduced

By Francis Monfort

30 May 2018

A Massachusetts loan officer will be heading to prison after admitting to her role in a short-sale scheme that defrauded banks and mortgage companies, the US Attorney’s Office for the District of Massachusetts announced.

Vanessa Ricci was sentenced to six months in prison before federal court in Boston. She was also sentenced to three years of supervised release and was ordered to pay restitution of $963,730. Ricci pleaded guilty to one count of conspiracy to commit bank fraud in March.

From August 2007 through June 2010, Ricci and her conspirators – Jasmin Polanco, Greisy Jimenez, and Hyacinth Bellerose – induced numerous banks to permit short sales of residential properties by submitting false and misleading documents.

While short sales are intended to be arm’s-length transactions, the buyers and sellers under the scheme were frequently related. Additionally, the sellers retained control of and frequently continued to live in the properties after the sale. The scheme allowed the purported sellers to be released from their unpaid mortgage debts and induced the purported buyers’ banks to provide financing for the deals.

As part of the conspiracy, Ricci and the others submitted phony earnings statements to support the loan applications for the purported sales. In addition, they submitted phony HUD-1 Settlement Statements that did not accurately reflect the disbursement of funds in the transactions.

Co-defendant Jimenez had pleaded guilty to two counts of bank fraud and one count of conspiracy to commit bank fraud. Polanco and Bellerose, both real estate closing attorneys, each pleaded guilty to conspiracy to commit bank fraud. Jimenez and Polanco are set to be sentenced in June, while Bellerose was sentenced to time served and one year of supervised release in March 2017.