Shaw Capital Management Headlines : Real estate agent indicted for mortgage fraud
Officials: Scheme may have cost many their homes
5:43 PM, Aug. 11, 2011
A real estate agent was charged Thursday with orchestrating a multimillion-dollar mortgage fraud scheme that authorities believe triggered dozens of foreclosures throughout Greater Cincinnati.
Rodney Riddle, 44, is accused in a federal indictment of mail fraud, wire fraud and bank fraud. The Sycamore Township man, who faces up to 30 years in prison if he is convicted, pleaded not guilty Thursday in U.S. District Court in Cincinnati.
The scheme described by prosecutors is similar to the type of mortgage scams that exploded in Greater Cincinnati and across the country in the years before the real estate market collapsed.
Federal prosecutors say Riddle persuaded dozens of people, including friends and fellow members of Zion Temple church in Avondale, to buy houses at inflated prices so he could collect lucrative fees.
They say the scheme ran from 2001 to 2006 during the height of the real estate boom and did not begin to unravel until the crash in 2008, when many of the homeowners fell into foreclosure.
“That’s when these schemes fall apart,” said Fred Alverson, spokesman for U.S. Attorney Carter Stewart.
Although prosecutors say the scheme resembles other mortgage frauds, they say this one differs in at least one respect: Many of the 59 properties involved are located close together, often on the same streets.
“Certainly, that would have a greater impact on a neighborhood,” Alverson said.
Prosecutors would not disclose the addresses because they have not yet been entered into evidence. Records list Riddle as an owner or co-owner of just two Hamilton County properties.
According to the indictment, Riddle and others filled out loan applications with false statements and lied about income and the amount of assets held by the prospective home buyers.
Prosecutors say Riddle also claimed that his home repair business, Quality Home Maintenance, had done extensive work on many of the houses. They say he then used bogus invoices for work he never did to justify a higher home sale price.
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