Mortgage Broker and Real Estate Developer Indicted in $19.6 Million Mortgage Fraud Scheme

Yesterday, a federal grand jury in San Francisco indicted Michael Ohayon and David Papera with conspiracy to commit bank fraud, bank fraud, and money laundering, United States Attorney Joseph P. Russoniello announced. According to the indictment, Ohayon, 41, and Papera, 47, are alleged to have recruited thirteen straw buyers who used their good credit scores to obtain more than $19.6 million in fraudulent residential mortgage loans from Washington Mutual Bank, with no intention of making either down payments or mortgage payments on the properties. The indictment further alleges that Ohayon, with Papera's knowledge, told the straw buyers that an entity controlled by Ohayon and Papera would use the loan proceeds to make the down payments and mortgage payments. Ohayon and Papera created and submitted to Washington Mutual Bank loan applications with numerous misstatements as to the straw buyers' income and assets. Posted in: Check Fraud