Two former paralegals for an Albany law firm admitted to roles in an alleged mortgage fraud scheme, the same investigation that saw the firm’s namesake indicted in July, records show.
Laurie Hinds and Malissa Edgerton, ages and address unavailable, appeared in U.S. District Court in Albany this past week, each pleading guilty to one count of conspiracy to defraud the United States.
They admitted to doing so by completing false U.S. Department of Housing and Urban Development documents related to home mortgages and submitting them to the federal government, according to the plea agreements.
The schemes involved mortgage loans involving PB Enterprises. Hinds and Edgerton admitted to agreeing with members of the Bouchard Law Firm, where both worked, to defraud mortgage lenders. Specifically, Hinds admitted to submitting fraudulent documents for properties in Troy and Schenectady; Edgerton for properties in Troy, Albany and Schenectady.
Both Hinds and Edgerton face up to five years in federal prison. Their final sentence is to be up to the judge, but they would be able to appeal any sentence over two years, three months.
Both were formally charged and pleaded guilty Wednesday. They are to be sentenced in December.
Another man, Kevin D. O’Connell, 62, admitted in federal court to a scheme involving PB Enterprises and Greater Atlantic Associates that encompassed 74 total properties and $5 million in loans from 2003 to 2007. O’Connell is to be sentenced Sept. 19.
O’Connell admitted that he and others secured excessive mortgages for numerous residential properties through the use of fraudulent loan applications, prosecutors in that case have said. He made false statements and diverted mortgage funds for the personal use of members of the conspiracy without disclosure to the financial institutions and other mortgage lenders.
O’Connell provided checks representing short-term loans or “gift money” to prospective borrowers to give the false appearance to the lending institutions that those borrowers had funds to make them appear more creditworthy. In fact, it was never disclosed to the lending institutions that the funds were repaid shortly after the closing.
At Bouchard, the firm’s namesake Michael G. Bouchard was indicted late last month in U.S. District Court in Albany on a total of 25 counts, including conspiracy and bank fraud. He is accused of officially representing the mortgage lenders at real estate closings, but really helping out those involved in the underlying schemes, according to his indictment.
Bouchard’s case remains pending. His attorney, Gaspar Castillo, has said Bouchard absolutely denies the allegations.
Bouchard is also accused of helping Team Title Abstractors.
In both schemes, Bouchard is accused of filing false forms with the federal government and concealing how the money was actually disbursed. The result would be an inflated price for the property and an inflated mortgage.
An investigation into Team Title Abstractors resulted in Matthew J. Kupic and Francis Thomas Disonell admitting to obtaining $3.6 million in excessive mortgages from 2000 to 2003. The mortgages then ended up in foreclosure. Both were sentenced in 2008 to two years in prison.
They admitted that they knew and willfully executed a scheme to defraud banks and other mortgage lenders by arranging to secure excessive mortgages for numerous homes by using fraudulent loan applications and settlement statements and diverting mortgage funds for their own use and to third parties.