New Jersey Builder Indicted On Bank Fraud And Bribery Charges As Part Of $1 Million Mortgage Fraud Scheme
NEWARK, N.J. – A federal grand jury indicted a Neshanic Station, New Jersey, man today for his role in a $1 million mortgage fraud scheme, including an alleged bribe of a bank agent to approve a loan on a property that exploded hours before the closing, U.S. Attorney Paul J. Fishman announced.
Antonio Pimenta, 46, is charged with one count of bank fraud conspiracy, three counts of bank fraud, and one count of bribing a financial institution’s agent. He was previously charged by complaint in September 2012 for bank fraud and money laundering. Pimenta will be arraigned before U.S. District Judge Esther Salas in Newark federal court on a date to be determined.
According to the indictment and other documents filed in this and related cases:
From 2007 to 2008, Pimenta and other conspirators engaged in two related mortgage fraud conspiracies through a company called Premier Mortgage Services. The conspirators targeted properties in low-income areas of New Jersey. After recruiting “straw buyers,” they used fraudulent documents to make it appear as though the straw buyers possessed far more assets and earned far more income than they actually did.
The conspirators then submitted these fraudulent documents as part of mortgage loan applications to financial institutions. Relying on these fraudulent documents, financial institutions provided mortgage loans for the subject properties. The conspirators then split the proceeds from the mortgages among themselves at closing time. The closings went forward through the use of fraudulent settlement statements (HUD-1s), which hid the true sources and destinations of the mortgage funds provided by financial institutions. The straw buyers had no means of paying the mortgages, and many of the properties entered into foreclosure proceedings.
Attorneys, paralegals, loan officers, and others performed different roles in the scheme. Pimenta owned and managed Kelmar Construction Co. Kelmar built properties that were then sold to straw buyers using fraudulent mortgage loans brokered by Klary Arcentales and closed by Linda Cohen, two other conspirators in the scheme.
On the morning of Oct. 19, 2007, one such property, located in Irvington, New Jersey, exploded the morning before the scheduled closing. Even though the house had been obliterated, Pimenta and others were still able to close on the fraudulent mortgage loan later that day by paying a $50,000 cash bribe to Cohen, the bank’s closing agent.
In total, fraudulent loans based on properties built by Pimenta’s company caused losses of more than $1 million.
Three previously charged conspirators have already pleaded guilty in connection with the scheme. Lester Soto, 58, of Freehold, New Jersey; Klary Arcentales, 46, of Lyndhurst, New Jersey; and Linda Cohen, 56, of Orange, New Jersey have each pleaded guilty before Judge Salas.
Each count in the indictment is punishable by a maximum potential penalty of 30 years in prison and a fine of $1 million.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, and special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, with the investigation. Fishman also thanked the Social Security Administration-Office of the Inspector General, under the direction of Special Agent in Charge Edward J. Ryan, for its participation in the investigation.
The government is represented by Assistant U.S. Attorneys Rahul Agarwal of the U.S. Attorney’s Office Special Prosecutions Division and Zach Intrater of the office’s Criminal Division.
The charges and allegations contained in the indictment are merely accusations, and the defendant is considered innocent unless and until proven guilty.
This case was brought in coordination with President Barack Obama’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. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
Defense counsel: Alain Leibman Esq., Princeton, New Jersey