Two people, including a 28-year-old Uncasville woman, were sentenced Wednesday in federal court for their roles in a large mortgage fraud scheme orchestrated by former New London mortgage broker Jose Guzman.
Melissa Valentin was sentenced to 18 months incarceration, the last nine months in home confinement, followed by two years of supervised release. Last summer, Valentin pleaded guilty to one count of conspiracy to commit mail fraud and wire fraud.
Between June 2004 and August 2006, Valentin purchased approximately five houses in the New London area by providing false information on mortgage loan applications. Some of the properties were resold during the conspiracy and others ended up in foreclosure. For her role, Valentin received approximately $15,676 from Guzman.
Valentin was ordered to pay restitution in the amount of $622,993.
Also sentenced Tuesday for his role was Michael Russo, 47, of New Haven, who will spend 21 months in prison followed by two years of supervised release. Russo pleaded guilty in December 2010 to one count of conspiracy to commit mail fraud and wire fraud.
Russo was a licensed real-estate sales agent who worked with Guzman, Maurizio Lancia, William Athan and others at Elizabeth Athan Realty in New London and Broad Street Investment Group in New London. During the conspiracy, Russo sought out residential properties to be bought and sold and recruited three individuals to act as buyers in connection with the fraudulent purchase of eight properties.
Russo knew that the mortgage loan applications and supporting documentation submitted to lenders contained many false statements, including false representations that the buyers were going to make the properties their primary residences, according U.S. Attorney David B.Fein's office. On certain transactions, Russo acted as a witness and signed documents filed in connection with the closings.
The individuals that Russo recruited received cash payments for acting as property buyers, and Russo sometimes received kickbacks from them, Fein's office said. The eight properties ultimately ended up in foreclosure, resulting in losses to lenders totaling more than $1.7 million.
Russo was ordered to forfeit $65,000 and to pay restitution in the amount of $1,523,091.11.
Sixteen individuals, including Guzman, Lancia and Athan, have been convicted of various charges stemming from this scheme. On April 3, 2012, Lancia was sentenced to 27 months of imprisonment. Guzman and Athan are awaiting sentencing.
The case was investigated by the Federal Bureau of Investigation and the U.S. Department of Housing and Urban Development, Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorneys Michael S. McGarry and David T. Huang.