Mortgage Fraud Broker Sentenced For His Role In Mortgage Fraud Conspiracy
CONTACT: Barbara Burns
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BUFFALO, N.Y. - U.S. Attorney James P. Kennedy Jr. announced today that Gregory Gibbons, 54, of Mobile, Alabama, who was convicted of conspiracy to commit wire fraud affecting a financial institution, was sentenced to time served by Chief U.S. District Judge Frank P. Geraci, Jr. The defendant was also ordered to pay restitution totaling $1,458,847.90 to the U.S. Department of Housing and Urban Development, CitiBank, and M&T Bank.
Assistant U.S. Attorneys Kathleen A. Lynch and Elizabeth Moellering, who handled the case, stated that between June 2008 and February 2009, the defendant conspired with others, including Alagi Samba, a realtor, and Daniel Badu, to devise a scheme to obtain eight loans for unqualified borrowers for homes in the Bronx, NY. As part of the scheme, Gibbons acted as the mortgage broker and altered income and asset documents of the borrowers before they were sent to financial institutions.
For instance, Gibbons altered and created documents to make it appear that defendant Badu qualified for a mortgage on a property at 814 Faile Street in the Bronx. The defendant indicated that Badu was a research ophthalmologist and earned a specific income when in fact, Badu was not a research ophthalmologist nor did he receive the income stated on a loan application. Gibbons knew that these false loan documents were submitted to
The Funding Source, a mortgage bank, in order to secure a loan insured by the Federal Housing Administration. Based on that false application and supporting documentation, the loan was approved. The Funding Source then sold the loan on the secondary market to M &T Bank, which wired funds from New York through the State of Ohio to purchase the loan.
The defendant and his co-conspirators arranged for additional fraudulent loans to be approved, including another loan for Badu, and caused wire communications to be transmitted in interstate commerce for those loans. These fraudulent transactions caused losses of approximately $4,800,007 affecting M&T Bank and other financial institutions including SunTrust Bank, JPMorgan Chase Bank, and Citibank.
The sentencing is the result of an investigation by the United States Postal Inspection Service, under the direction of Inspector-in-Charge Joseph Cronin, Boston Division; the Department of Housing and Urban Development, under the direction of Special Agent in Charge Brad Geary; and the Federal Bureau of Investigation, Buffalo Division, under the direction of Special Agent-in-Charge Gary Loeffert.
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