Two Westbury men and 15 others face charges of taking part in the biggest mortgage fraud and identity theft scheme ever in Nassau County, duping homeowners, banks and the county out of more than $20 million, the Nassau District Attorney’s Office announced Wednesday.
Members of the ring - which included lawyers, real estate and mortgage brokers, bank employees, an appraiser, a financial consultant and even a U.S. Postal Service worker - relied on identity theft to impersonate sellers and buyers at closings and steal the proceeds of six home sales in the Westbury area, District Attorney Kathleen Rice said.
In one variation of the scam, ringleaders James R. Sweet, 43, and Dwayne Benjamin, 44, both of Westbury, agreed to pay more than the asking price for homes and then pocketed the difference between the real asking price and the mortgage, Rice said. Benjamin is a U.S. Postal employee.
The ring also illegally defrauded Nassau County out of $80,000 in subsidized rent payments for tenants who leased homes illegally bought through the scam, she said.
“Sweet and his co-conspirators used their knowledge of the mortgage industry for their own financial gain at the expense of the innocent consumers, financial institutions and the Nassau County government,” said Richard H. Newman, the state superintendent of banks, in a prepared statement.
The district attorney’s office and the state have brought a racketeering case against the white-collar ring, charging them under the Organized Crime Control Act, the state counterpart to the federal Racketeer Influenced and Corrupt Organizations, or RICO, statute.
The ring typically bought homes in foreclosure or at risk of going into foreclosure. After buying homes and reaping profits through their scams, the ring typically stopped paying the mortgage and allowed homes to fall into foreclosure, according to the district attorney.
Sellers of homes were unaware that the ring received mortgages that exceeded the sellers’ asking prices, prosecutors said.
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