Federal Prison Time Not Enough For NJ Foreclosure Rescue Equity Stripping Duo; Garden State Prosecutors Score Add'l Prison Time In State Slammer For Pair That Targeted Financially Distressed High-Equity/No-Cash Homeowners With Sale Leaseback Ripoffs
In Trenton, New Jersey, the Asbury Park Press reports:
- A father and son were sentenced Friday to state prison for stealing more $1.3 million in a scheme that offered relief for homeowners facing foreclosure.
Vito Grippo, 58, of Jackson, was sentenced to 10 years in state prison after pleading guilty in February to charges including theft [by failure to make required disposition of property received] and money laundering. His son, Frederick P. Grippo, 32, of Old Bridge, was sentenced to four years in prison. He pleaded guilty in January to a charge of theft [by deception].
Both were sentenced by state Superior Court judges in Union County.
The sentences came a week after Vito Grippo was sentenced to 96 months in federal prison and Frederick Grippo was sentenced to 41 months in federal prison.
The state and federal sentences will run concurrently, and they will serve in federal prison first.
According to the state:
Vito Grippo, who had an office in Holmdel, solicited 12 homeowners facing foreclosure by offering to temporarily transfer title of their home to a company called Morgan Financial. He told them they would keep 80 percent to 90 percent interest in the home; Morgan Financial and an investor would share the rest.
He told them to make their monthly mortgage payments to Morgan Financial, and Morgan Financial would pay the lender, reducing their payments over time and giving them back title to their homes in a year.
Grippo also solicited investors who didn’t know they were buying the homes outright; they thought they were investing in income-generating rental properties. He used the identities of the investors to file fraudulent mortgage applications to buy the homes.
Frederick Grippo, a loan broker, submitted fraudulent applications, the state said.
Vito Grippo obtained more than $4.5 million to purchase 12 homes in New Jersey and New York. He stole more than $1.3 million in loan proceeds that should have been disbursed to the original homeowners as equity at the closing. And he diverted the money into his companies’ bank accounts, the state said.
Although Vito Grippo made some mortgage payments in the names of the investors, all of the homes fell into foreclosure. The homeowners lost their properties. And the investors’ credit ratings were ruined, the state said.
See also, The Trentonian: Father and son real estate cheats get prison time:
- Vito Grippo had the original homeowners and the investors sign documents without giving them time to ascertain what they were signing.