Ex-Bank of America Employee Pleads Guilty to Mortgage Fraud Scam Using Stolen Identities to Buy Homes Not For Sale

Venedie Roberto Valencia, a former Bank of America employee, is now sentenced to 15 months in federal prison for a mortgage scam he was involved in that used stolen identities to buy homes in Southern California that weren’t being sold. The sentence comes after Valencia, 27, pleaded guilty and admitted that he forged a document linked to bogus bank accounts. As part of his penalty, Valencia must pay $51,688 in restitution.

Valencia’s sentence comes two years after co-conspirator licensed real estate agent Felix Pichardo was sentenced to eight years over the same mortgage scam. Pichardo was asked to pay $770,000 in restitution. Per court documents, the latter used bogus identities on loan applications to buy mortgages on real estate properties that weren’t for sale.

After pleading guilty in 2009, Pichardo admitted that he used to people’s identities to gain access to mortgage loans for properties even though their owners weren’t selling.. Pichardo then cause separate loan applications for $360,000 and $417,000 to be sent to AmTrust bank. The applications were turned in without the consent of the property owner. Pichardo and another conspirator, Latrice Shaunte Borders pocketed the loan proceeds.

Borders also pleaded guilty to criminal charges (for bank fraud) in 2009. She too was ordered to pay $ restitution.

Mortgage Scams
Unfortunately, mortgage fraud occurs more often than we’d like to think. In the process, lenders and borrowers are being bilked of millions of dollars.

Last year, the owners of Premier One Lending Group were indicted for allegedly securing over $30 million in loans through the use of hundreds of loan applications that upped the actual assets and income of the borrowers. Bogus bank documents and income verification documents were also given to lenders. Also last year, more than a dozen people were arrested in connection with a mortgage scheme in Ventura County, California that resulted in the loss of millions of dollars when the homes foreclosed.

In a separate mortgage fraud case, prosecutors filed a civil lawsuit accusing a number of real estate professionals over their involvement in an alleged scam to get unqualified buyers mortgage loans that were insured by the government. Bank statements, pay stubs, government agency letters over benefits that didn’t exist, and other documents were allegedly fabricated.

Meantime, in an unrelated case, mortgage brokerage firm owner Mikhail Kosachevich and his loan processor Jeffrey Gerken were sentenced to 33 months and six months in prison, respectively, over a mortgage scam that cost lenders at least $7 million.

Recently, three mortgage professionals and a title agent were accused of scamming senior citizens. Using the 1st Continental Mortgage Company in Florida, in 2009 and 2010, they allegedly processed 14 reverse mortgages and secured $2.5 million in reverse mortgage loans that the Federal Housing Administration had insured. The money wasn’t used to pay for existing loans and about $1 million in illegal loan proceeds were said to have been pocketed.

Former Bank of America employee sentenced in mortgage fraud scheme, Los Angeles Times, August 29, 2011

Reverse mortgage scam targeted seniors, Miami Herald, July 6, 2011


O.C. mortgage firm busted in crackdown, OC Register, June 17, 2010

More Blog Posts:

Democrats Call for Shareholder Approval of Corporate and Political Spending, Institutional Investor Securities Blog, August 2, 2011

Securities Lawsuits Expected to Reach Record High in ’11, Says Advisen Ltd. Report, Institutional Investor Securities Blog, April 23, 2011

Dodd-Frank Reforms Will Lower Deficit by $3.2B Over the Next Decade, Estimates CBO, Institutional Investor Securities Blog, April 8, 2011

Our securities fraud attorneys represent institutional investors throughout the US.