Rhode Island Mortgage Loan Processor Pleads Guilty in $3.5 Million Mortgage Fraud Scheme

A mortgage loan processor with National City Mortgage Company pleaded guilty today in U.S. District Court in Providence, R.I., to his participation in a “straw-borrowing” scheme that netted more than $3.5 million in fraudulently obtained mortgages on 13 properties in five Rhode Island communities, all of which were eventually foreclosed upon.

U.S. Attorney Peter F. Neronha announced the guilty plea of Miguel Valerio, 52, of Providence to two counts of conspiracy to commit bank and wire fraud. Valerio and two others, Juan Carlos Hernandez, 42, of West Warwick, R.I., a loan officer with National City Mortgage Company; and James D. Levitt, 66, of Pawtucket, R.I., a former real estate attorney, were named in a 13-count federal indictment returned on May 25, 2011.

At today’s court hearing, Valerio admitted his participation in schemes in which he, Hernandez and Levitt conspired to recruit and pay “straw-purchasers” to purchase properties in Cranston, Central Falls, Coventry, Pawtucket, and Providence that the buyers would not normally qualify to purchase.

Posted in: Internal Fraud ACH and Wire Fraud