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Press Release

Real Estate Agent Pleads Guilty in Mortgage Fraud Scheme

For Immediate Release
U.S. Attorney's Office, District of Maryland

Baltimore, Maryland – Real estate agent Christopher A. Kwegan, age 59, of Randallstown, Maryland pleaded guilty today to charges arising from the fraudulent purchase of a Baltimore City property using fraudulent loan documentation and a straw purchaser.

The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation, Baltimore Field Office; Special Agent in Charge Cary A. Rubenstein of the U.S. Department of Housing and Urban Development Office of Inspector General; and Special Agent in Charge Brian Murphy of the United States Secret Service - Baltimore Field Office.

According to his guilty plea, in the summer of 2008, Kwegan learned that Mr. K.D. was trying to sell a row house he owned in Baltimore City on Washington Boulevard.  Mr. K.D. had purchased the property 10 years earlier for $11,500.  Kwegan told Mr. K.D. that he could sell it for $75,000.  Mr. K.D. was dubious, but agreed to sell it for that price. 

Rather than trying to sell the property at the actual market price, Kwegan requested assistence from accountant Cecil Chester and real estate agent/consultant Michael Camphor, who were already operating a mortgage fraud scheme.  Kwegan arranged to use the personal identifiers of an individual recruited by Chester – Ms. D.B. – to buy the property as a straw purchaser. A “straw purchaser” is an individual whose name and personal identifiers are used by fraudsters to acquire the property, but who does not contribute his or her own funds to the purchase and who has no intention of actually residing in the property. 

Ms. D.B., who lived in Queens, New York, was inexperienced with residential real estate transactions and with the Baltimore real estate market. To encourage Ms. D.B. to buy the property, Chester promised her that she would need to put up little if any money to cover the down payment and closing costs on this property. Ms. D.B. lacked the necessary assets to pay for the down payments and closing costs on the property out of her own resources, or the income to keep up the mortgage payments on the house after the transaction closed, as Kwegan and Chester knew.

Kwegan and Chester set the price not at $75,000, but at $250,000.  Chester provided a mortgage loan broker located in Towson with a false loan application and fraudulent supporting documents which inaccurately represented that Ms. D.B. worked for a fictitious company that Chester had created, and which falsely inflated her annual income. Chester also falsely represented that Ms. D.B. lived in Baltimore City, and the amount of assets she had in a bank account.

Based upon these false representations, a bank wired $242,500 to finance the purchase of the property, at the settlement on September 30, 2008.  As the purchaser, Ms. D.B. was required to provide $9,391.53 to cover the down payment and her share of the closing costs.  Because she lacked the necessary funds, Kwegan used his own funds to obtain a cashier’s check for that amount, which was tendered to the settlement company on her behalf.

After the settlement, just $15,773.65 was disbursed to Mr. K.D., the seller of the property.  In contrast, $145,000 was wired to an entity identified as “CAK,” which were Kwegan’s initials.   These funds were transferred into Kwegan’s bank account.  Kwegan then wrote a check to Chester for $35,000.   

No payments were made on the mortgage.  The property went into foreclosure and remains unsold at this time, resulting in a loss of between $150,000 and $235,000.

Kwegan faces a maximum sentence of 30 years in prison and a $250,000 fine for conspiring to commit wire and mail fraud, and for wire fraud.  U.S. District Judge James K. Bredar has scheduled sentencing for November 4, 2016 at 10:00 a.m.

Cecil Sylvester Chester, age 69, of Mitchellville, Maryland previously pleaded guilty to the same charges arising from the fraudulent purchase of seven properties in Baltimore, resulting in losses of over $1.7 million. Michael Gerard Camphor, age 60, of Baltimore, previously pleaded guilty to charges arising from the fraudulent purchase of four properties in Baltimore resulting in losses of over $736,000. Judge Bredar scheduled Camphor and Chester’s sentencings for August 26 and October 4, 2016, respectively.

The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available at

Today’s announcement is part of the efforts undertaken in connection with the President’s Financial Fraud Enforcement Task Force.  The task force was established 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.  Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants.  For more information on the task force, please visit

United States Attorney Rod J. Rosenstein commended the FBI , HUD OIG - Office of Investigations and the U.S. Secret Service for their work in the investigation.  Mr. Rosenstein thanked Assistant U.S. Attorneys Jefferson M. Gray and Evan T. Shea, who are prosecuting the case.

Updated July 5, 2016

Mortgage Fraud