Newport News Man Sentenced to 41 Months for Mortgage Fraud
NEWPORT NEWS, Va. – Ephrain Harris, 49, of Newport News, Va., was sentenced today to 41 months in prison, for conspiracy to commit mail and wire fraud.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia, made the announcement after sentencing by United States District Judge Rebecca Beach Smith. Harris pled guilty on October 21, 2010.
According to court documents Harris owned and operated Can Do Accounting, in the City of Newport News and was engaged in preparing tax returns and other accounting services. For approximately one year, from September, 2007, through September 2008, a co-conspirator worked as a mortgage broker and owned and operated USA Processing and Destiny Consulting, located in the Eastern District of Virginia. An FBI investigation revealed that during that time period the co-conspirator and others were engaged in a mortgage fraud scheme in the Tidewater area. The object of the scheme was to obtain financing from First Horizon Home Loan Corp. that was to be used to fund the closings on various residential properties. Numerous false documents were submitted and relied on by the lender. The defendant was involved in creating and providing false employment and income documentation to the co-conspirator in order to provide fraudulent verification to mortgage lenders of applicant’s ability to qualify for loans. The conspirators also used seller proceeds to fund the property transactions and purchase cashier’s checks without the knowledge or consent of the mortgage lender. These cashier’s checks were then used to provide the required buyer closing costs and down payment. In this manner, the conspirators concealed the true source of the required borrower funds and acted contrary to the instructions of the mortgage lender, which would not have approved this use of funds.
The defendant and other conspirators wired funds from locations and financial institutions outside of the Commonwealth of Virginia to financial institutions within the Eastern District of Virginia. The defendant created false pay stubs, and/or W-2 forms and tax returns for over twenty loan transactions that were relied on by the lender in funding the loans. Losses in property values related to the scheme approached $780,000.
The case was investigated by the FBI and Housing and Urban Development , Office of the Inspector General. Assistant United States Attorney Brian J. Samuels prosecuted this case on behalf of the United States.A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on http://pacer.uspci.uscourts.gov.