Connecticut man remains held on bond for his role in alleged housing scam

New Haven — An Easton man arrested last week remains in custody on federal charges for operating a mortgage-fraud scheme that allegedly targeted homeowners who were on the verge of losing their homes.

A detention hearing, which would have decided whether Timothy Burke remains in custody or be released on bond, was continued to Dec. 7.

U.S. Magistrate Judge Sarah A. L. Merriam told Burke and his attorney on Tuesday that she needed more information about a proposed third-party custodian arrangement, which would release him into the custody of his brother, Jeffrey Burke, who lives in Kent.

An investigation by The Day in 2014 found more than a half-dozen instances across the state — in Bridgeport, New London, Griswold, Waterbury, Plymouth, Portland, Andover, New Haven and West Haven — in which property owners facing foreclosure believe they were misled and taken advantage of by Burke.

Law enforcement officers believe that Burke and his associates sent out mass mailings to people whose homes were in foreclosure — information that is available to the public on the state Judicial Branch website.

Former employees interviewed by federal authorities said they mailed 800 to 1,000 letters a week to homeowners in foreclosure, according to a court affidavit.

Burke was charged with mail fraud, an offense that carries a maximum prison term of 20 years.

Merriam also wanted more financial information from Burke, who according to the affidavit made at least $5 million from running the mortgage scheme between 2008 to November 2014.

Burke, who went by Bill and Jimmy, told the property owners that he would buy their homes from them, enabling them to walk away from their debts and other financial obligations.

Instead, the homeowners who spoke to The Day said he paid them a small amount of cash and then rented out the property, keeping the rent money instead of applying them to the mortgages, taxes and other property-related expenses.

The affidavit said Burke also used the aliases Kerry Saunders, Pat Riley, Jim Caldwell, Jim Saunders, Tom Morrisey, Phil Burke and Burt.

Burke was sentenced in 2003 in U.S. District Court in New Jersey to 60 months in prison for participating in an "equity skimming" scheme similar to what Connecticut homeowners described to The Day.

According to the federal complaint, Burke started to run his scheme in Connecticut in May 2008 while he was still under federal supervision.

i.larraneta@theday.com

Twitter: @larraneta

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