New Haven Attorney Involved In Mortgage Fraud Scheme Sentenced To 21 Months In Prison
David B. Fein, United States Attorney for the District of Connecticut, announced that DAVID KINNEY, 54, of Woodbridge, was sentenced today by Senior United States District Judge Alfred V. Covello in Hartford to 21 months of imprisonment, followed by two years of supervised release, for participating in a mortgage fraud scheme and for making false statements to federal law enforcement.
According to court documents and statements made in court, KINNEY, a New Haven-based attorney, participated in a mortgage fraud conspiracy in 2006 and 2007 by acting as the settlement agent in connection with fraudulent real estate transactions in New London County. As part of the scheme, KINNEY submitted, or caused to be submitted, materially false HUD-l settlement statements to lenders. In certain cases, KINNEY released a disbursement check before he had received the down payment listed on the HUD-1.
On November 5, 2007, in connection with the investigation of this matter, FBI special agents served KINNEY a subpoena at his New Haven office. On that date, KINNEY told agents that he had never given anyone a closing check prior to receiving the down payment money in connection with real estate closings that he handled when, in fact, he had done so on multiple occasions.
As part of his sentence, Judge Covello ordered KINNEY to pay restitution in the amount $507,155.24 and to forfeit $65,749.59.
On November 9, 2011, KINNEY pleaded guilty to one count of conspiracy and one count of making a false statement.
This case was investigated by the Federal Bureau of Investigation and the U.S. Department of Housing and Urban Development, Office of Inspector General. The case is being prosecuted by Assistant United States Attorneys Michael S. McGarry and David T. Huang.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants.
To report financial fraud crimes, and to learn more about the President’s Financial Fraud Enforcement Task Force, please visit www.stopfraud.gov.
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