Man Pleads Guilty To $1.1 Million Mortgage Fraud Scheme In Rhode Island
A disbarred lawyer from Rhode Island recently pleaded guilty in federal court to three counts of bank fraud and two counts of filing false federal tax returns in relation to a $1.1 million mortgage fraud scheme.
According to prosecutors, James Levitt, 66, admitted to submitting fraudulent applications in order to obtain mortgage financing so as to buy two properties from a friend who was facing foreclosure. He also illegally deposited $270,000 into his personal bank account after the closings. The two properties eventually foreclosed.
Levitt is also facing a state charge for posing as a lawyer because he conducted the activity under the pretense of being an attorney after having been disbarred in 1991 in connection with loans arranged for a family court judge.
In exchange for his guilty plea, prosecutors dismissed conspiracy charges and bank fraud charges in another case.
Mortgage fraud is on the rise across the country. According to the FBI’s 2010 Mortgage Fraud Report, the “hot spots" for mortgage fraud include California, Florida and New York, states which also have some of the worst unemployment and mortgage default rates in the nation.