Baltimore Feds Squeeze Guilty Plea Out Of Title Agency Owner For Pocketing $3M+ In Closing Cash Intended To Satisfy Existing Mortgages

From the Office of the U.S. Attorney (Baltimore, Maryland):

• Michael A. Gmeinwieser, age 38, of Crofton, Maryland, pleaded guilty [] to wire fraud in a scheme to divert over $3 million in settlement funds intended to pay off the previous mortgage on the properties to himself and his company.

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• According to Gmeinwieser’s plea, he was the sole owner of Innovative Title LLC (“Innovative”) located in Odenton, Maryland, and was responsible for preparing settlement statements, issuing title insurance, disbursing mortgage proceeds and other funds, and ensuring that relevant paperwork was properly completed for real estate closings.



• Gmeinwieser arranged real estate purchase or refinancing transactions that entailed temporarily depositing funds from a mortgage lender into Innovative’s escrow account to pay off the lien secured against the property by a prior lender. Instead of transferring the funds held in escrow to the prior lender as promised, Gmeinwieser diverted the funds to other uses for himself and Innovative.



• Gmeinwieser’s misappropriation of funds occurred during real estate transactions involving third party borrowers as well as transactions in which he refinanced mortgages secured by properties he owned. After carrying out refinancing transactions involving third party borrowers, Gmeinwieser made monthly mortgage payments on the borrower’s behalf in an effort to decrease the likelihood that the borrower would discover that their original loan had not been paid in full as agreed.



• The losses to the lending institutions that distributed mortgage loans on the basis of Gmeinwieser’s false promises amounted to approximately $3,041,497.

For the U.S. Attorney press release, see Title Company Owner Pleads Guilty to Wire Fraud in Scheme to Divert over $3 Million Intended to Payoff Previous Mortgages.