Upper Marlboro woman pleads guilty to wire fraud in mortgage fraud scheme | USAO-MD
green belt, Maryland – Tammy Jones, aka “Tammy Taylor”, 53, of Upper Marlboro, Maryland, pleaded guilty yesterday to wire fraud in connection with a mortgage fraud scheme. As part of his plea deal, Jones will have to pay $111,377.12 in restitution.
The guilty plea was announced by United States Attorney for the District of Maryland Erek L. Barron and Special Agent in Charge Bertrand Nelson of the Office of Inspector General of the United States Department of Housing and Urban Development.
According to his guilty plea, in May 2011 Jones bought a house in Brandywine, Maryland. To finance the home purchase, Jones secured a $360,660 mortgage from Lender 1, which was backed by the Federal Housing Administration (FHA).
In 2017, Jones applied for and received a loan modification for his FHA-insured mortgage through the U.S. Department of Housing and Urban Development’s (HUD) Partial Claims Program, which is a loan modification program for FHA-insured mortgages. Under the Partial Claim Program, HUD works to restructure the borrower’s mortgage payments using a partial claim that allows the borrower to stay in the home. A lender files a “partial claim” with HUD for a portion of the outstanding mortgage balance and HUD makes payment to the lender on behalf of the borrower for that portion of the mortgage. In exchange, HUD receives a security interest in the property for the balance that has been paid to the lender and the borrower agrees to repay HUD for the amount of the partial claim. Thus, the lender is effectively “repaired” by partial payment of HUD’s claim. When the borrower sells the home, the borrower is ultimately responsible for the balance of the partial claim to remove the lien held by HUD.
As noted in his plea agreement, in or around June 2017, Jones applied for and received a loan modification through HUD’s Partial Claims Program for his home in Brandywine, Maryland. HUD made a partial claim payment to Servicer 1 (which serviced Jones’ FHA-insured mortgage) of $111,377.12 on Jones’ behalf. In exchange, Jones granted HUD a security interest in the Brandywine, Maryland property for $111,377.12, the amount of the partial payment of the claim made by HUD. Jones also entered into a loan modification agreement with the mortgage lender, in which Jones owed $352,151.01 in principal and agreed to make monthly payments of $2,564.96.
In 2018, Jones sought to sell the Brandywine, Maryland property for $429,900. To complete the sale of the property, employees of a settlement company demanded proof that Jones’ lien from HUD and the FHA had been released.
In fact, the privilege had not been released. Jones then created false and fraudulent documents to make it look like the lien had been released to facilitate the sale of the Brandywine, Maryland home in the scheme.
Specifically, Jones created a fraudulent email account, claiming to be an employee of a company hired by HUD to service loans on HUD’s behalf. Jones, posing as an employee of contractor HUD, told a settlement company employee that the lien on the Brandywine, Maryland home had been released and that Jones had created and attached a false document privilege release. Jones subsequently continued to contact the settlement company while posing as an employee of the contractor HUD. Jones also submitted a fraudulent certificate of satisfaction to the settlement company, which allowed the sale of the Brandywine, Maryland property on or about October 19, 2018.
After the sale of the Brandywine, Maryland property closed, the induvial who purchased the home from Jones was made aware of the outstanding lien on the property in 2019. The investigation revealed that Jones had falsified documents and had fraudulently posed as an employee of contractor HUD in order to continue his scheme to defraud HUD.
In total, Jones caused HUD a net loss of $111,377.12, representing the partial claim HUD paid on Jones’ behalf in September 2017.
Jones faces a maximum sentence of 20 years in prison followed by a maximum of three years of supervised release for wire fraud. U.S. District Judge Theodore D. Chuang set sentencing for May 20, 2022 at 2:30 p.m.
United States Attorney Erek L. Barron commended HUD-OIG for its work in the investigation. Mr. Barron thanked Assistant U.S. Attorney Caitlin R. Cottingham, who is prosecuting the case.
For more information about the Maryland U.S. Attorney’s Office, its priorities, and the resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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