News and Press Releases

Four Defendants Pled Guilty in Multi-Million Mortgage Fraud Scheme at Jade Apartment Complex in Miami

FOR IMMEDIATE RELEASE
October 5, 2012

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, José A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division (IRS-CID), and Paula Reid, Special Agent in Charge, United States Secret Service, Miami Field Office, announce that defendants Lilia Casal-Diaz, 42, a real estate attorney, Raquel DeJesus Martinez, 36, a former mortgage broker, Andres Mendez a/k/a “Andy Mendez, Sr.,” 47, and his son, Andy Mendez, a/k/a Andy Mendez, Jr.,” 26, who both worked as real estate brokers, all of Miami-Dade County, have pled guilty to charges involving a multi-million dollar mortgage fraud scheme at the luxury Jade apartment complex, on Brickell Bay Drive, in Miami, Florida. According to court documents, the mortgage fraud scheme resulted in more than $5.6 million in mortgage proceeds that were fraudulently obtained from various lending institutions.

Casal-Diaz pled guilty before U.S. Magistrate Judge Barry L. Garber on October 4, 2012, to conspiracy to commit tax fraud, in violation of Title 18, United States Code, Section 371, in connection with creating false documents to conceal from the IRS loan proceeds that were derived from the mortgage fraud scheme. According to court documents, Casal-Diaz, who practiced law in Coral Gables, falsified HUD-1 documents to support the loan fraud scheme, and then failed to report on IRS Form 1099-S the sales proceeds from the transactions, or otherwise intentionally under-reported such proceeds. In addition, when approached by IRS-CI agents, Casal-Diaz provided the agents with a phony Form 1099-S document, falsely indicating that proceeds from one of the real estate closings was properly reported to the IRS. Sentencing is scheduled for November 27, 2012. At sentencing, the defendant faces a possible statutory maximum sentence of up to five years in prison and a possible fine of up to $250,000.

Also on October 4, 2012, also before Magistrate Judge Garber, Raquel DeJesus Martinez pled guilty to conspiracy to commit mail fraud and money laundering, in violation of Title 18, United States Code, Section 371, in connection with the same mortgage fraud scheme. According to court documents, DeJesus Martinez falsified mortgage paperwork and created false documents to falsely represent to lenders that straw buyers involved in the scheme had sufficient assets and income to qualify for million dollar mortgages, when such straw byers would not have otherwise qualified. Sentencing is scheduled for December 18, 2012. At sentencing, the defendant faces a possible statutory maximum sentence of up to five years in prison and a possible fine of up to $250,000.

Previously, on September 6, 2012, Andy Mendez Sr. and Andy Mendez Jr. pled guilty before U.S. District Judge Donald M. Middlebrooks to conspiracy to commit mail fraud in connection with the same mortgage fraud scheme, in violation of Title 18, United States Code, Section 1349. According to court documents, Mendez Sr. recruited others to participate in the scheme and used shell companies to receive and pay kickbacks to other conspirators. Mendez Sr. recruited his son, Mendez Jr., to falsify documents and provide false notarizations to make it appear that straw buyers were qualified for loans. In exchange for his participation, Mendez Jr. received undisclosed kickbacks to a shell company that were paid by other conspirators acting at the direction of Mendez Sr. Sentencing for both Mendez Sr. and Mendez Jr. is scheduled for November 27, 2012. At sentencing, the defendants face a possible statutory maximum sentence of up to 30 years in prison.

The convictions of Casal-Diaz, DeJesus Martinez, Mendez Sr. and Mendez Jr., bring to eight the total number of persons convicted in connection with the same mortgage fraud scheme involving the Jade Apartments. Earlier, defendants Josephine Santana, 57, a mortgage broker, Jose Rafael Martinez, 36, a straw buyer, and Basilio Gomez, 52, also a straw buyer, and all of Miami-Dade County, pled guilty to conspiracy to commit mail fraud in connection with a multi-million dollar mortgage fraud scheme, in violation of Title 18, United States Code, Section 1349. Sentencing is scheduled for October 29, 2012.

In a related case, defendant Jose Arnaldo Rosario, 55, of Miami-Dade County, was sentenced on August 5, 2011 for his role in the scheme. Rosario was sentenced to 46 months in prison, to be followed by 3 years of supervised release. Rosario previously pled guilty to conspiracy to commit money laundering and wire fraud, in violation of Title 18, United States Code, Section 371. Rosario provided false information to the lending institution and received two kickbacks from the purchase of two apartments.

In a related case, defendant Jose Arnaldo Rosario, 55, of Miami-Dade County, was sentenced on August 5, 2011 for his role in the scheme. Rosario was sentenced to 46 months in prison, to be followed by 3 years of supervised release. Rosario previously pled guilty to conspiracy to commit money laundering and wire fraud, in violation of Title 18, United States Code, Section 371. Rosario provided false information to the lending institution and received two kickbacks from the purchase of two apartments.

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A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

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