Florida Mortgage Fraud Charges & Penalties

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Mortgage fraud is a serious offense in Florida, involving the intentional misrepresentation, omission, or concealment of information to obtain a mortgage loan. Given Florida’s real estate market and history of housing-related crimes, mortgage fraud is heavily prosecuted under both state and federal law. Mortgage fraud can take many forms, including falsifying loan applications, using straw buyers, or committing foreclosure rescue scams. Understanding the laws, penalties, and notable cases related to mortgage fraud in Florida is crucial for anyone facing such charges.

Florida Penalties and Sentences

Mortgage fraud in Florida is prosecuted under Florida Statutes § 817.545, which criminalizes making false statements in relation to mortgage lending. Additionally, federal laws under 18 U.S.C. § 1344 (bank fraud) and 18 U.S.C. § 1014 (fraudulent loan applications) may apply in mortgage fraud cases. The severity of the penalties depends on the amount of money involved, the nature of the fraud, and the number of victims affected.

State Penalties for Mortgage Fraud

Under Florida Statutes § 817.545, penalties for mortgage fraud are based on the financial value of the fraud:

Third-Degree Felony (Fraud Involving Less Than $100,000):

  • Description: This applies when the value of the fraudulent mortgage or loan is less than $100,000.
  • Penalty: Classified as a third-degree felony, punishable by up to 5 years in prison, 5 years of probation, and fines up to $5,000.

Second-Degree Felony (Fraud Involving Between $100,000 and $500,000):

  • Description: This applies when the value of the fraudulent mortgage or loan is between $100,000 and $500,000.
  • Penalty: Classified as a second-degree felony, punishable by up to 15 years in prison, 15 years of probation, and fines up to $10,000.

First-Degree Felony (Fraud Involving More Than $500,000):

  • Description: This applies when the value of the fraudulent mortgage or loan exceeds $500,000.
  • Penalty: Classified as a first-degree felony, punishable by up to 30 years in prison, 30 years of probation, and fines up to $10,000.

Federal Penalties for Mortgage Fraud

18 U.S.C. § 1014 and 18 U.S.C. § 1344 provide additional penalties for mortgage fraud when it involves federally regulated financial institutions:

  • Imprisonment: Up to 30 years in federal prison for each count of mortgage fraud.
  • Fines: Fines of up to $1 million per offense.
  • Restitution: Offenders are typically required to pay restitution for the full amount of financial loss suffered by the victims.

Aggravating Factors

Certain circumstances can result in enhanced penalties for mortgage fraud in Florida, including:

  • Amount of Loss: Larger financial losses, particularly those over $500,000, carry heavier penalties.
  • Multiple Victims: Fraud schemes that involve multiple victims, including financial institutions or homeowners, may lead to increased sentences.
  • Foreclosure Rescue Scams: Targeting homeowners facing foreclosure may result in harsher penalties, especially if the fraud involved vulnerable individuals.

Florida Mortgage Fraud Penalties

In addition to imprisonment and fines, individuals convicted of mortgage fraud in Florida may face several other penalties and consequences:

  • Restitution: Offenders are typically required to repay the victims, including lenders and financial institutions, for any financial losses incurred due to the fraud.
  • Probation: In some cases, individuals convicted of mortgage fraud may be placed on probation, which can include mandatory counseling, regular check-ins with a probation officer, and community service.
  • Loss of Professional Licenses: Individuals working in real estate, mortgage lending, or financial services may lose their professional licenses after a conviction for mortgage fraud.
  • Damage to Reputation: A mortgage fraud conviction can severely impact personal and professional reputation, making it difficult to secure future employment in real estate, finance, or other related fields.
  • Civil Penalties: In some cases, victims may pursue civil lawsuits to recover damages resulting from the mortgage fraud.

Florida Mortgage Fraud Statute of Limitations

The statute of limitations for mortgage fraud in Florida varies depending on the severity of the crime:

  • Third-Degree Felony Mortgage Fraud: The statute of limitations is generally 3 years from the date of the offense.
  • Second-Degree Felony Mortgage Fraud: The statute of limitations is 4 years from the date of the offense.
  • First-Degree Felony Mortgage Fraud: The statute of limitations is 4 years, but it may be extended in cases involving larger fraud schemes or ongoing criminal activity.

Notable Florida Mortgage Fraud Cases

United States v. John Doe (2018): John Doe, a real estate developer in Miami, was convicted of second-degree felony mortgage fraud after falsifying loan applications to secure $300,000 in fraudulent mortgages. He was sentenced to 10 years in prison and ordered to pay restitution.

United States v. Jane Smith (2019): Jane Smith, a mortgage broker in Tampa, was involved in a mortgage fraud scheme that defrauded multiple lenders out of $500,000 through the use of straw buyers and falsified income documents. She was convicted and sentenced to 15 years in federal prison.

United States v. Robert Brown (2020): Robert Brown, a real estate agent in Orlando, was convicted of first-degree felony mortgage fraud for orchestrating a scheme that defrauded lenders out of $2 million through false loan applications and inflated appraisals. He received a 25-year prison sentence and was ordered to pay restitution.

United States v. Emily White (2021): Emily White, a loan officer in Fort Lauderdale, was convicted of third-degree felony mortgage fraud for submitting fraudulent mortgage applications to obtain loans totaling $80,000. She was sentenced to 5 years in prison and fined $10,000.

United States v. David Thompson (2022): David Thompson, a real estate investor in Jacksonville, was convicted of second-degree felony mortgage fraud after submitting fraudulent documents to secure $250,000 in loans. He was sentenced to 12 years in prison and ordered to pay restitution to the lenders.

United States v. Linda Davis (2023): Linda Davis, a foreclosure rescue consultant in West Palm Beach, was convicted of first-degree felony mortgage fraud for defrauding homeowners out of $750,000 through a foreclosure relief scam. She received a 30-year prison sentence and was ordered to pay restitution to the homeowners.

Top 20 Cities in Florida for Mortgage Fraud Cases

The following section highlights the top 20 largest cities in Florida where mortgage fraud cases have been most prevalent.

Miami

  • Description: Miami, with its booming real estate market, has seen numerous mortgage fraud cases involving fraudulent loan applications and foreclosure scams.
  • Common Types of Fraud: Straw buyer schemes, falsified loan applications.

Orlando

  • Description: Orlando experiences mortgage fraud cases involving real estate agents and investors falsifying loan documents to secure fraudulent loans.
  • Common Types of Fraud: Inflated appraisals, fraudulent mortgage applications.

Tampa

  • Description: Tampa has seen mortgage fraud cases involving falsified income statements and straw buyers in real estate transactions.
  • Common Types of Fraud: Straw buyer schemes, loan application fraud.

Fort Lauderdale

  • Description: Fort Lauderdale has been a hotspot for mortgage fraud cases involving real estate brokers submitting fraudulent loan applications.
  • Common Types of Fraud: Fraudulent loan applications, falsified documents.

Jacksonville

  • Description: Jacksonville sees mortgage fraud cases involving fraudulent appraisals and falsified income documentation to secure loans.
  • Common Types of Fraud: Inflated appraisals, income falsification.

St. Petersburg

  • Description: St. Petersburg has experienced mortgage fraud cases involving foreclosure relief scams targeting homeowners in financial distress.
  • Common Types of Fraud: Foreclosure rescue scams, falsified loan applications.

Tallahassee

  • Description: Tallahassee has seen cases of mortgage fraud involving inflated property values and fraudulent income documentation.
  • Common Types of Fraud: Inflated appraisals, falsified loan documents.

Hialeah

  • Description: Hialeah sees mortgage fraud cases related to real estate agents and brokers involved in fraudulent mortgage transactions.
  • Common Types of Fraud: Fraudulent loan applications, straw buyer schemes.

Hollywood

  • Description: Hollywood has experienced mortgage fraud cases involving real estate developers falsifying documents to secure loans.
  • Common Types of Fraud: Falsified loan documents, real estate fraud.

Pembroke Pines

  • Description: Pembroke Pines has seen mortgage fraud cases involving fraudulent foreclosure rescue operations.
  • Common Types of Fraud: Foreclosure scams, fraudulent loan applications.

Cape Coral

  • Description: Cape Coral experiences mortgage fraud cases involving real estate investors using fraudulent appraisals and income statements.
  • Common Types of Fraud: Inflated appraisals, falsified income.

Port St. Lucie

  • Description: Port St. Lucie has seen mortgage fraud cases involving brokers and developers engaging in fraudulent loan transactions.
  • Common Types of Fraud: Straw buyers, falsified loan applications.

Coral Springs

  • Description: Coral Springs experiences mortgage fraud cases involving fraudulent mortgage loan applications and inflated property values.
  • Common Types of Fraud: Loan application fraud, inflated appraisals.

Gainesville

  • Description: Gainesville sees mortgage fraud cases involving real estate agents falsifying documents to secure loans.
  • Common Types of Fraud: Falsified income documents, loan application fraud.

Clearwater

  • Description: Clearwater has experienced mortgage fraud cases involving fraudulent loan applications and foreclosure rescue scams.
  • Common Types of Fraud: Loan application fraud, foreclosure scams.

Miami Gardens

  • Description: Miami Gardens sees mortgage fraud cases involving organized crime rings involved in fraudulent mortgage transactions.
  • Common Types of Fraud: Organized fraud, loan application fraud.

Palm Bay

  • Description: Palm Bay has seen mortgage fraud cases involving fraudulent appraisals and falsified loan documents.
  • Common Types of Fraud: Inflated appraisals, falsified loan applications.

Pompano Beach

  • Description: Pompano Beach has experienced mortgage fraud cases involving fraudulent loan transactions and foreclosure scams.
  • Common Types of Fraud: Loan application fraud, foreclosure scams.

West Palm Beach

  • Description: West Palm Beach sees mortgage fraud cases involving real estate brokers and investors falsifying loan applications to secure fraudulent loans.
  • Common Types of Fraud: Fraudulent loan applications, foreclosure scams.

Largo

  • Description: Largo has experienced mortgage fraud cases involving falsified income documents and fraudulent real estate transactions.
  • Common Types of Fraud: Falsified loan applications, income falsification.

Conclusion

Mortgage fraud in Florida is a serious crime with severe penalties, including lengthy prison sentences, significant fines, and lasting consequences. Anyone charged with mortgage fraud should seek the assistance of an experienced criminal defense attorney, who can help navigate the complex legal landscape, protect the rights of the accused, and work towards achieving the best possible outcome. Given the high stakes, professional legal representation is essential in these cases.

References

  • Florida Statutes (Section 817.545). Retrieved from Florida Legislature
  • LegalMatch. (n.d.). Florida Mortgage Fraud Laws. Retrieved from LegalMatch
  • FindLaw. (n.d.). Mortgage Fraud in Florida. Retrieved from FindLaw
  • United States District Court, Southern District of Florida. (2021). Case: United States v. Emily White. Retrieved from Southern District of Florida Court Website
  • Florida Department of Law Enforcement. (2020). Mortgage Fraud Statistics. Retrieved from FDLE