Thursday, March 22, 2007

Federal jury convicts real estate investor of DFW mortgage fraud scheme

By Pegasus News wire

A federal jury convicted Vernon Cooks, Jr., a.k.a Jibreel Rashad, on all counts of a mortgage fraud scheme in the Dallas area from May 2003 through December 2004.

Cooks, 40, was convicted of one count of bank fraud, seven counts of wire fraud and six counts of money laundering. He is scheduled to be sentenced on July 2. One other co-defendant who was involved in the same scheme has pled guilty and is awaiting sentencing. Co-defendant Deirdre Dione Anderson, who was charged with six counts of wire fraud, was acquitted.

Prosecutors said Cooks, who sad he was a real estate investor and the owner of “Rashad Investment Group,” knowingly created a scheme to defraud mortgage lenders out of hundreds of thousands of dollars. Cooks used straw purchasers to buy single-family homes in the Dallas area for amounts far above fair market value. Straw purchasers testified that Cooks paid them to use their names and credit to purchase homes that Cooks was going to rent to others. Cooks told the straw purchasers he would pay all closing costs, mortgage payments and taxes associated with the properties until he transferred them out their names, within six months to a year after closing.

To support the inflated sales prices of the homes, Cooks used fraudulent appraisals. He also caused fraudulent loan applications and other supporting documents, including fraudulent tax returns, W2s, and employment, rent and deposit verifications, to be submitted to the mortgage lenders so that the straw borrowers would qualify for the inflated loans. Once the lenders funded the loans, Cooks used the fraudulently-obtained proceeds to pay off the original, bona-fide sellers and kept the rest of the funds for himself. Cooks then allowed the mortgage loans to default in the straw purchasers’ names.

Source: U.S. attorney's office

See more stories in:

• Crime > White Collar

Comments