Over the years, I have seen many variations of mortgage fraud. As soon as one scheme is thwarted, another seems to take its place.
One particular flipping scheme being currently adjudicated, involving sixty properties (sic), is really for the books!
Michael and Jeremie Sheneman allegedly defrauded both real estate buyers and mortgage lenders through a series of calculated misrepresentations.
The scheme lasted from 2003 to 2005, when they were busted.
Their scam was classic mortgage fraud:
(1) acquire control over a large number of rental properties,
(2) induce buyers to purchase the properties through a host of false promises, and
(3) ensure that lenders would finance the purchases by pitching falsified loan documents to the lenders and misrepresenting the buyers' financial standing.
Note that I emphasized the words "acquire control over" these properties.
Let's see why that is central to the scheme!