Pair Gets Multi-Year Prison Stays For Running Straw Buyer Flipping Scams, Rent To Own Ripoffs

From the Office of the U.S. Attorney (Seattle, Washington):

• Two men who engaged in a mortgage fraud scheme that collapsed with the real estate downturn, were sentenced [] to federal prison terms in U.S. District Court in Seattle. ROBERT STRONG, 48, of Bothell, Washington was sentenced to four years in prison and ANTHONY WALDRON, 49, of Kirkland, Washington was sentenced to 42 months in prison. Between 2005 and 2008, the men used fraudulent information to obtain more than $13 million in loans on 30 different properties, primarily in South King County. When the scheme ended and the homes went into foreclosure the lenders had lost more than $2.5 million.

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• According to records filed in the case, the men recruited straw buyers with good credit to “purchase” the houses. These straw buyers were paid as much as $18,000 for use of their identity and credit score on the loan documents. The men submitted false employment information on the straw buyers, in one case claiming the woman made $22,000 per month working for an entity they created and controlled. Using this false information the men got banks to fund the mortgages on the houses, then the men would quickly “sell” the house to another straw buyer at a higher price to claim the additional mortgage funds. The men also rented the houses on “rent to own” plans, asking the renters to pay an option, ranging from $400-$7000, to purchase the home at a later date and at an increased price. The men also falsely claimed repairs were made to the homes and increased the value of the homes based on those repair bills. Instead they pocketed the money that they claimed went to home improvements.

For the U.S. Attorney press release, see Two King County Men Sentenced To Prison For Mortgage Fraud Scheme (Pair Used Straw Buyers to Buy and “Flip” Houses, Defrauding Banks of more than $2.5 Million).