A Great Neck couple were sentenced to prison Friday for committing fraud schemes to get out of their mortgage debt and to obtain Medicaid benefits, federal authorities said.
Joseph and Sofia Atias were sentenced to 40 months and 28 months in prison, respectively, after they were convicted of bank fraud, conspiracy to commit bank fraud and Medicaid fraud, prosecutors said.
“Joseph and Sofia Atias committed fraud schemes to try to get out from under mortgage debt and to fraudulently obtain Medicaid funds, essentially flaunting the laws to which we all must adhere,” stated Eastern District U.S. Attorney Richard P. Donoghue in a statement.
As part of their sentences, the defendants were ordered to pay $465,965 in forfeiture and $49,956 in restitution.
At trial, federal prosecutors said that shortly before the sale of their property adjacent to Sacred Heart Academy for $925,000, the defendants sold the property in a short sale to Bank of America for $480,000 to discharge their mortgage debt.
In negotiating the short sale with the bank, the defendants concealed Sacred Heart Academy’s pending offer and submitted a fraudulent contract of sale and other false documents representing that they did not have funds to pay off the mortgage in full, prosecutors said.
As part of the fraudulent short sale, the defendants used a relative as a “straw buyer” of the property to create the appearance of an arms-length sale. Shortly after that sale, the straw buyer sold the property to Sacred Heart Academy for approximately half a million dollars in profit, officials said.
Federal prosecutors also said the defendants fraudulently obtained Medicaid funds between 2009 and 2015 by concealing their self-employment income and available cash resources, including trust fund money and the $465,000 in proceeds from the bank fraud scheme.
“May today’s sentencing remind those who exploit government programs and manipulate gaps in the mortgage and banking sectors that they will face the error of their ways,” Donoghue said.