Due to the lapse in appropriations, Department of Justice websites will not be regularly updated. The Department’s essential law enforcement and national security functions will continue. Please refer to the Department of Justice’s contingency plan for more information.

You are here

Justice News

Department of Justice
U.S. Attorney’s Office
District of New Jersey

Friday, November 8, 2013

Property Manager Admits Role In Multimillion-Dollar Mortgage Fraud

CAMDEN, N.J. – A property manager admitted today to conspiring to defraud financial institutions as part of a multimillion-dollar mortgage fraud scam that used phony documents and “straw buyers” to make illegal profits on over-developed condominiums in the Wildwood, N.J., U.S. Attorney Paul J. Fishman announced.

Steven Schlatmann, 27, of Jersey City, N.J., pleaded guilty before U.S. District Judge Jerome B. Simandle in Camden federal court to an information charging him with one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering.

According to documents filed in this case and statements made in court:

Schlatmann and his conspirators identified homes in Wildwood and Wildwood Crest. Schlatmann’s conspirators recruited straw buyers to purchase those properties at inflated rates. The straw buyers had good credit scores but lacked the financial resources to qualify for mortgage loans. Schlatmann was aware that his conspirators created fraudulent loan applications that contained false information concerning the straw buyers’ employment, income, assets and intended use of the properties. These actions were designed to make the straw buyers appear more creditworthy than they actually were in order to induce the lenders to make the loans.

Schlatmann and his conspirators caused fraudulent mortgage loan applications in the name of the straw buyers, including the supporting documents, to be submitted to mortgage brokers that the brokers knew were false. Once the loans were approved and the mortgage lenders sent the loan proceeds, Schlatmann’s conspirators took a portion of the proceeds, having funds wired or checks deposited into various accounts they controlled from the fraudulent mortgage loans or lines of credit on several properties. They also distributed a portion of the proceeds to other members of the conspiracy for their respective roles. For his part in the conspiracy, Schlatmann received $259,294 from four separate real estate transactions.

The wire fraud conspiracy charge is punishable by a maximum potential penalty of 30 years in prison and a $1 million fine. The conspiracy to commit money laundering charge is punishable by a maximum potential penalty of 10 years in prison and a $250,000 fine. Schlatmann’s sentencing is scheduled for March 24, 2014.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark; and IRS–Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen in Newark, for the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Jacqueline M. Carle of the U.S. Attorney’s Office Criminal Division in Camden.


Defense counsel: John Klotz Esq., Clifton, N.J.

Schlatmann, Steven Information

Updated August 21, 2015