BusinessWeek: Tiburones en la piscina del mercado inmobiliario

SEPTEMBER 5, 2005NEWS: ANALYSIS & COMMENTARY 

Sharks In The Housing Pool

Deed thieves, property flippers, equity strippers -- these con artists are duping banks and homeowners

By most measures, Matthew B. Cox would appear to be a mortgage lender's dream customer. The 36-year-old former Tampa resident had once worked in the mortgage business, so he understood intimately what it took to qualify for a loan. And Cox threw plenty of business at mortgage lenders in Florida, and then Georgia: An aspiring real estate investor, Cox took out $3.7 million in mortgages to finance his apparently ever-growing stable of houses.

But in reality, Cox was the industry's worst nightmare. Federal law enforcement officials say that Cox -- a.k.a. Michael Shanahan, David Freeman, and Gerald Cugno -- along with his girlfriend, Rebecca M. Hauck, masterminded a massive mortgage fraud that ensnared at least 10 different lenders, including Bank of America Corp. and SunTrust Banks Inc.


Using nearly a dozen stolen identities, the pair forged "deeds of satisfaction" to convince banks that they had paid off loans for -- and thus owned -- homes that, in fact, they were renting from the true owners.

With these fake documents, Cox then persuaded banks to lend him millions beginning in 2002 and into 2004 -- millions he and his girlfriend subsequently absconded with. So brazen was Cox that he left some of the mortgage brokers who closed his loans in Florida a copy of his novel-in-progress, titled The Associates -- little more than a barely fictionalized account of his escapades. Cox and his girlfriend are now on the lam, their faces plastered on wanted posters distributed to bankers, mortgage brokers, and real estate agents. "We want to catch him so we can put him on trial," says David E. Nahmius, U.S. Attorney for the Northern District of Georgia.

Compañía de préstamos sospecha de fraude departe de agentes hipotecarios

Mortgage company suspects fraud by Tampa brokers

While workers say they haven't been paid, the Clearwater company's CEO says some loans show signs of fraud.

By MIKE BRASSFIELD, St. Petersburg Times Staff Writer
Published August 5, 2005

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A group of Tampa workers twice recently have picketed outside the headquarters of a Clearwater mortgage financing company, saying they haven't been paid for about two months of work. But the company says its reputation is being unfairly smeared.

"We have done nothing wrong," said Jerry Cugno, CEO of Premier Mortgage Funding.

The Clearwater company and a Tampa mortgage broker are trading accusations of fraud. State regulators say they will investigate.

Tampa mortgage broker Victor Perry says he signed a contract on May 13 to become a branch of Premier, which has about 600 branches nationwide. Perry says he and a dozen employees have been signing customers up for mortgages in 36 states using the Premier name.

When banks or title companies sent the Tampa employees their commissions from the approved loans, the office sent the checks to Premier headquarters. Perry says that Premier was then supposed to pay his employees their commissions, but that the company hasn't been doing that. This prompted the picketing last week.

However, Cugno says he is happy to pay the workers what they are owed. The problem, he says, is that some of the loans show signs of fraud.

Cugno said he has begun paying commissions for some loans, but cannot pay for loans he suspects are fraudulent. "We have to separate the good loans from the bad," he said.