Multimillion dollar mortgage fraud lands PA man in prison

by Ryan Smith02 Apr 2014
A Pennsylvania man has been sentenced to almost five years in prison and ordered to repay more than $5.4 million for his role in a mortgage fraud scheme.

Simon H. Aouad, 35, pleaded guilty to conspiracy, mail fraud and bank fraud. Prosecutors say Aouad and his co-conspirators purchased properties in New Jersey and Massachusetts by using falsified information to obtain mortgages, as well as fraudulently obtaining lines of credit at what was then Wachovia Bank.

In one scheme, properties in New Jersey were purchased for inflated prices using phony borrower income and asset information. Buyers received thousands of dollars in kickbacks in the scheme, according to the U.S. Attorney’s Office. Another scheme involved straw buyers purchasing Massachusetts properties from the conspirators at inflated prices, financing the sales with fraudulently obtained mortgages and splitting the proceeds.

The fraudulently obtained mortgages in both schemes ended up in default, costing the lenders more than $5 million.

In addition to his prison term and restitution, Aouad must serve five years of supervised release and forfeit more than $3.6 million.


Should CFPB have more supervision over credit agencies?