Miami Criminal Defense Lawyer Blog

Four South Florida residents were found guilty by a jury on mortgage fraud charges. The mortgage fraud scheme resulted in losses to the former Wachovia Bank in excess of $800,000. Government prosecutors from the U.S. Attorney's Office prosecuted the case that was investigated by the U.S. Secret Service and the Miami-Dade County Police Department, Economic Crimes Division. The four defendants, Sixto Figueroa, Susy Figueroa, Rolando Herrera and Manuel Garcia were each represented by a Miami criminal lawyer with years of experience defending clients in federal court.

The jurors heard testimony that the Figueroas were the masterminds of the mortgage fraud operation and recruited Herrera and Garcia to participate in their scheme to defraud. Herrera and Garcia were recruited to act as straw buyers for lots located in Port Labelle, Florida. Herrera and Garcia received kickbacks for their involvement in the mortgage fraud scheme. Herrera and Garcia paid inflated prices for the lots owned by the Figueroas. The Figueroas submitted fraudulent loan applications to Wachovia which contained false information including misrepresented financial information of the straw buyers such as tax returns and bank statements that had no basis in reality. Testimony also revealed that HUD-1 documents were also falsified which reflected that Herrera and Garcia used their own money to make the down payments and closing costs, when in fact the Figeuroas made all of the payments.

After Wachovia approved the loans, the money was sent to a title company which improperly released the funds directly to the Figueroas who in turn used the money to pay the closing costs for their co-defendants and the kickbacks for becoming involved in the fraud. Eventually, all of the loans went into default after the straw buyers failed to make the payments. All four defendants were convicted on charges of bank fraud and conspiracy to commit bank fraud, in violation of United States Code, 1349 and 1344. Each of the defendants is facing the statutory maximum of 30 years in prison, restitution and fines. The sentencing hearing federal court is set in September, 2010. The Figeuroas will likely receive significantly loftier sentences than the straw buyers as they were the organizers of the mortgage fraud.

As in all federal convictions or guilty pleas, a federal probation officer will investigate the defendants' backgrounds, calculate the sentencing guidelines for each of the defendants and draft a pre-sentence investigation report (PSI). The PSI will be used by the government prosecutors and defense attorneys as a basis for their arguments at the hearing the and the judge will consider it in determining what is supposed to be a fair sentence. The probation officer has 30 days to submit the report, while the attorneys have an additional 30 days to file objections to the report and/or sentencing memoranda of law.

Florida Jury Convicts Four Residents for Wachovia Mortgage Fraud Scheme, Loan Safe.org, July 23, 2010.

A Sarasota man was convicted on multiple fraud charges in the United States District Court for the Middle District of Florida. Beau Diamond was formerly represented by a Miami criminal defense lawyer prior to the feds initiating an investigation, but the third lawyer he retained actually defended Diamond during the eight day jury trial. Sentencing has been set for October 7, 2010. Diamond was accused of running a $37 million Ponzi scheme while he was supposed to running a legitimate investment club. Many of the alleged victims testified on behalf of the government.

After hearing all of the evidence, the jury convicted the defendant on all 18 counts including mail fraud, wire fraud, money laundering, and other illegal monetary transactions. The government argued that Diamond spent $7 million of investor money to pay for an expensive condominium, a sports car and gambling trips to Las Vegas. Approximately 200 investors lost money as a result of Diamond's organized scheme to defraud. The prosecution alleged that the defendant guaranteed exorbitant returns to investors, but in reality was using new investors' money to pay old investors, and in reality he never a made a profit trading the FOREX market.

Prior to the sentencing hearing in federal court, a federal probation officer will do a thorough background check on Diamond in order to give the government, his defense lawyer and judge an idea about his past. The probation officer will also calculate Diamond's sentencing guidelines. The probation will take into account the offenses for which he was convicted and any aggravating or mitigating factors that can either increase or decrease his sentence. While Diamond's lack of a past criminal record will help him, the vulnerability of the victims, the amount of loss, the fact that he was the organizer, and the lack of acceptance of responsibility will weigh heavily on his recommended guidelines. The federal sentencing guidelines, are just that, guidelines. The court can deviate upwards or downwards depending on certain factors set forth in the federal statutes and case law.

After the pre-sentence investigation is completed by the department of probation, the judge, the government and defense counsel will be provided with a copy. Government lawyers and defense attorneys have 30 days to file objections to the report and to the calculated recommended sentencing guidelines. A experienced criminal attorney will object to all level increases and argue for as many level reductions applicable in a particular case. Defense counsel should also make Booker arguments in an effort to receive a sentence below the recommended guidelines.

The defense attorney who defended Diamond at trial will also handle the appeal in the case. In federal court, the trial lawyer is also responsible for all appellate matters. It is not likely that the U.S. district judge that presided over the trial will release Diamond pending the outcome of the appeal. In any event, Diamond is looking at approximately 20 years in federal prison, but will receive and exact sentence on October 7, 2010..

Beau Diamond to Learn His Fate on October 7, Sarasota Herald Tribune.com, July 23, 2010.

Federal law enforcement authorities charged 94 people with Medicare fraud. Those charged are accused of filing fraudulent claims with the publically funded healthcare program. Of the 94 people indicted, only 36 have been arrested. Twenty-five of those charged were allegedly linked to Miami Medicare fraud schemes. One of those indicted in Miami was Dr. Jorge J. Dieppa. According to court documents, he allegedly filed $103 million in fraudulent claims to Medicare for home healthcare, HIV treatment and for medical equipment. The authorities were unable to locate the doctor, but believe he is on vacation. Dieppa faces many years in jail as the amount of loss to the federal healthcare system is rather large. He should retain a Miami criminal attorney experienced in defending cases in federal court that deal with healthcare fraud. The arrests come just before the healthcare fraud summit to be headed up by the attorney general and a high level official from the Department of Human Services.

Other individuals charged and/or arrested were linked to Brooklyn, Baton Rouge, Houston and Detroit. This just happens to be some of the cities where the Medicare strike force is targeting their efforts. As posted in yesterday's blog, some of the defendants fraudulently billed Medicare for unneeded or unprovided physical and /or occupational therapies that never occurred or that were unnecessary. The case out of Brooklyn, New York involved undercover federal agents and wiretaps that were used to implicate a Russian mob syndicate. The ring leader of the healthcare fraud operation was taped discussing payoffs to patients and clinic personnel.

Over 350 federal agent were involved in the arrests and the case is largest Medicare fraud bust since the inception of the federal healthcare program which began operating in 1965. Undoubtedly, the indictments and arrests were supposed to occur before officials conducted the summit on Friday. The federal government had to show the money and manpower thrown at the Medicare fraud problem was working. Future summits have been planned in cities where healthcare fraud is most prevalent including Los Angeles, Las Vegas, Boston, Detroit, Philadelphia and New York. The Obama administration is under pressure to prove that they are curtailing the problem, especially in light of the fact that the healthcare programs budget was increased significantly with the passage of the new healthcare legislation.

Anyone operating clinics must keep a sharp on their operation. While some individuals intentional defraud the federal healthcare system, others make unintentional billing mistakes which could cause federal agents to look at their clinic. It is imperative that clinics make as few mistakes as possible or they may find themselves at the heart of a federal investigation, or worse prosecution in federal court. If clinic owners, doctors, physician's assistant or patients find themselves being contacted by federal agents, they must seek out a Miami criminal defense law firm experienced in defending these types of charges in federal court. As with all other types of cases, never speak to law enforcement prior to speaking to qualified legal counsel in order to protect your interests and rights.

Feds Charge 94 Medicare Fraud Suspects in Miami, Other Cities, The Miami Herald.com July 16, 2010.

Despite the effort, man power, and millions of dollars being thrown at Medicare fraud, the federal government does not have an answer to the problem. South Florida and Miami Medicare fraud cases continue to exist despite the extensive operations of federal law enforcement investigators. As the fed clamps down, new areas are being targeted for fraud. Medicare is now being billed for fraudulent mental health and physical therapy treatments. Physical and occupational therapy schemes appear to be replacing the fraudulent billing for medical treatment and medical equipment. As concerns grow, the attorney general and the secretary for Health and Human Services will hold a healthcare fraud summit in Miami.

The head of the Medicare strike force for South Florida and the Miami area reported that the majority of Medicare fraud cases are still fraudulent billing for medical treatments for HIV patients, home healthcare for diabetics and billing for medical equipment, however, new types of cases are arising from billing by shady mental health centers. According to the director of Medicare in South Florida, the pressure placed on the medical clinics has caused them move to more fertile areas such as mental health and rehabilitative facilities. Just last year, rehabilitation facilities in South Florida billed Medicare approximately $171 million which significantly higher than California and New York. Despite the shift in strategies, it is apparent that Miami criminal defense lawyers will be defending clients charged with Medicare fraud in federal court for years to come.

Medicare fraud is expected to cost taxpayers approximately $68 billion next year. If the federal government ever gets its act together, it will like seek to shut down many clinics and health care facilities. Despite losing the battle, the Medicare fraud strike force has continued to investigate and the U.S. Attorney''s Office continues to prosecute these offenses. Since Medicare fraud became targeted in 2005, approximately 1,000 defendants have been prosecuted in South Florida and Miami for filing almost $3 billion in fraudulent bills. Whatever the angle may be, those who engage in Medicare fraud use the same tools such as kickbacks to patients, billing for unnecessary procedures and equipment and submitting fraudulent billing codes to skirt Medicare's technology.

Some experts blame the ongoing problem of Medicare fraud on the growing number of immigrants into the United States. The experts also believe that individuals turn to healthcare fraud because they believe the punishment for white collar crimes is less severe than punishments for violent crimes or drug trafficking offenses. Defendants charged with Medicare fraud and other white collar crimes should be aware that the penalties for these types of offense can even be more harsh. The penalties for white collar crimes always depends on the amount of the loss. That being the case, a person committing large scale healthcare fraud can receive a harsher sentenced that an defendant charged with cocaine trafficking.

Magnitude of Medicare Fraud in South Florida Grows, The Miami Herald.com July 13, 2010.

A defendant is alleged to have attached illegal scanners to automated teller machines in order to steal account information and rip-off tens of thousands of dollars. Mihal Arnautu, a Romanian national, is in custody in the Palm Beach County Jail. He is charged with 3 counts of fraud, grand theft, identity theft and one count of computer fraud and organized scheme to defraud. The defendant was arrested in Miami Beach by law enforcement officers from Palm Beach Gardens, Boca Raton and Miami Beach. He appeared at his bond hearing where a circuit court judge set bail at $68,000. However, he will not be released if even he posts the bond and he an immigration detainer.

Credit card fraud has been an increasing concern by state and federal law enforcement authorities. Lately, investigations are all leading back to Eastern Europe. All types of cyber and internet crimes have been emanating from that part of the world. Miami criminal lawyers have seen a rise in credit card fraud and identity theft cases that are being prosecuted in the Miami and South Florida area. Law enforcement authorities are cracking down on individuals that secretly place electronic skimming devices at ATMs. The "skimmers" are attached in an effort to capture victim's account numbers. Perpetrators also attach video cameras in order to gather pin numbers.

The police have gathered significant evidence against Arnautu. Surveillance videos retrieved in Palm Beach Gardens and Boca Raton depict the defendant placing skimmers on the machines and later removing them. A branch manager at Citibank located in Palm Beach Gardens reported that he located a skimmer at his branch. A further investigation conducted by the bank revealed that 28 accounts had be skimmed with loss exceeding $44,00.00. These cases of identity theft occurred between Palm Beach and Miami-Dade County. The Palm Beach County State Attorney was quoted as saying, "Some individuals fail to change their behavior after having been given the opportunity to avoid a criminal conviction through participation in a pre-trial program."

While this defendant was provided the opportunity to initially complete a pre-trial diversion program for first time offenders, it is a little surprising that the state attorney's office afforded the defendant that opportunity due to the nature of the case. Pre-trial diversion or intervention is available both in county and circuit. Prosecutors will often offer the program for minimal offenses. Only first-time offenders have the ability to participate in such a program. However, if a defendant successfully completes the conditions set forth by the prosecution, the case will be nolle prossed or dismissed within six months. Conditions include community service hours, certain classes and may also include a drug evaluation and treatment. While pre-trial intervention should never be accepted unless the prosecution can prove its case, it a guaranteed way to have the charges dropped. Once the charges are dropped a person can than go through the seal and/or expungement process.

Delray Beach Man Charged with ":Skimming" Accounts of ATMs, Stealing Thousands, The Palm Beach Post, July 13, 2010.

Several current and former Broward County police officers and one FBI agent have all been charged in a mortgage fraud indictment. The criminal defense lawyer representing one of the officers stated the cops did nothing wrong and were merely investors and that the mortgage brokers were the individuals committing the fraud. Thirteen defendants were charged in the indictment. The majority of the defendants appeared last week at their bond hearing. The magistrate hearing the cases approved bail for all of the defendants. The indictment alleges that the lending institutions lost in excess of the $16.5 million as a result of the scheme to defraud.

The cases against the officers is built around information provided by the mortgage brokers. They both surrendered last week and were granted bail. The indictment alleges that former Plantation police officer, Joseph Guaracino, while acting as the president of the "Home Buyers Group", located and purchased 38 properties in Broward and Palm Beach Counties on behalf of seven other current and former law enforcement officers. The defendant are charged along with mortgage brokers and lawyers for misrepresenting income, job titles, financial records and loan application to obtain loans between 2004 and 2007.

The two lawyers indicted on the case allegedly participated in the scam by acting as mortgage brokers and title agents. The FBI agent who is represented by two Miami criminal defense lawyers, has not been placed on administrative leave and is receiving pay. While it is unusual for law enforcement officers under investigation not to be suspended, the agent's supervisors are allowing him to work because they are of the belief that he did not violate any laws. The agent is accused of obtaining a loan on a $445,000 home by supplying misinformation. According to the indictment, he is accused of submitting false information in order to obtain the loan.

The current and former police offices may have a defense to the mortgage fraud indictment. The government will have to prove that the officers actually provided false information on the loan applications. The first line of defense will be that the mortgage brokers turned government witnesses actually provided the false information and not the police officers. The defense attorneys will point the finger at the government witnesses and show that the only reason they are testifying is to reduce their sentences. Without other independent evidence showing that the police officers actually falsified the documents, the governments case appears to be weak. Of course this only applies as long as the law enforcement officers did not provide statements inculpating themselves. Always remember that if you are being investigated for this type of case, seek out an experienced Miami mortgage fraud defense lawyer to protect your rights.

Mortgage Fraud Case is Bogus, Broward Cops' Lawyers Say, The Miami Herald, July 2, 2010.

The operations director for the National Insurance Crime Bureau says the epidemic of insurance fraud and staged accidents has taken the lead in Tampa, Florida. Staged accident cases arise when individuals become involved in intentional car crashes with the intent to file false claims with insurance companies. In a typical staged accident or insurance fraud case, an individual sets up a staged accident between willing participants who agree to become involved in car crash at pre-set time and location. The police arrive and fill out an accident report. The drivers and passengers of the vehicles typically go to a sham clinic that rarely if ever provide treatment for these individuals. The clinic bills the insurance companies under the policies who in turn provide monetary kickbacks to the participants in the staged accident. Clinic owners, chiropractors, physician's assistants, accident planners and organizers, drivers and passengers have all been charged criminally throughout the State Florida. Miami criminal defense attorneys have represented all of these types or participants in staged accident cases.

Miami used to hold the title of the staged accident capital, but has given way to Tampa. Miami-Dade County created a task force in an effort to quell the problem..In fact, the Miami-Dade County State Attorney's Office has a specialized division with prosecutors who do nothing else but charge and prosecute these types of insurance fraud cases. These efforts have apparently chased off the staged accident cases to more fertile ground. Tampa has seen a 209% increase in the number of stage accident cases. Nationwide, Tampa is now only second to New York City. As a result, Tampa has now created its own task force to fight the problem. The fraud is so out of control that the State of Florida is the home to $100 million dollars in false claims a year. The states with the highest levels of fraud are those that have no fault coverage like Florida's PIP (personal injury protection).

Staged accident and insurance fraud crimes are charged under Florida Statute 817.234. The statues were modified a couple of years back in order to send a message to all those involved in insurance fraud. As a result, organizers and participants in a staged accident case face a two year minimum mandatory prison sentence if the prosecution can prove that they knowingly planned, organized or participated in an intentional motor vehicle crash. Insurance fraud and staged accident cases are built by the prosecution from the bottom up. Investigators will seek to first interview the drivers and passengers to get them to provide information regarding the organizer and the sham clinics. Providing information to law enforcement investigators may or may not preclude cooperating participants from prosecution. If you are contacted by law enforcement regarding a staged accident, seek counsel from a criminal defense lawyer experienced in defending these types of cases.

If a participant desires to speak to a detective regarding a case, it is imperative to receive an immunity letter and a guarantee of non-prosecution. Otherwise, statements given can and will be used to prosecute a case with possibility of the cooperating witness receiving no benefit. If an individual decides that this is the proper course of action, they should retain a criminal lawyer to make sure their rights are protected prior to speaking with the authorities.

Tampa Speeds by Miami as Florida's New Capital for Staged Auto Accidents, St. Petersburg Times, June 29, 2010..

As a result of the near depression in 2008, federal, state and local law enforcement have continued their effort to quell the fraudulent mortgage application and closing practices that have existed in South Florida and across the country for the past ten years. Everyone is aware that Miami-Dade County has the highest concentration of mortgage fraud in the entire country. As a result of the notoriety, Miami-Dade County's mayor, Carlos Alvarez created a local mortgage task force assigned to investigating and prosecuting mortgage fraud cases under Florida Statute § 817.545. The statute sets forth criminal liability for individuals who intentionally make material misstatements, misrepresentations that lenders and banking institutions use to determine whether or not to provide a loan. Miami criminal defense lawyers have seen an increase in the number of clients charged in Miami mortgage fraud cases.

There are two types of mortgage fraud that can be perpetrated. The first is committing fraud to obtain property which usually involves an individual providing misinformation to lending institution in an effort to obtain a single piece of property. The second type of mortgage fraud cases which is more closely scrutinized is fraudulently obtaining loans to make a profit. In fact, it is these types of cases that are specifically targeted by the task force. These cases involve straw buyers, unscrupulous appraisers, real estate agents and mortgage brokers that eventually end up with the lending institutions holding the bag with worthless mortgages and foreclosed properties.

There have been recent reports of innocent homeowners being unknowingly caught up in mortgage fraud schemes. Some homeowners have been wrongly arrested for mortgage fraud. These home owners were duped in signing blank or incomplete documents being told that this would speed up the lending and closing process. After the documents are signed, the true perpetrators either make false and fraudulent entries or make substantial changes without the knowledge or consent of the home buyer. Remember, if you are contacted by the mortgage fraud task force regarding the purchase of a piece of property, contact a Miami criminal defense law firm before speaking to the authorities. Any statements you give, may inadvertently build a stronger case for the prosecution.

The task force receives complaints and tips on a web site operated by the Miami-Dade County Mortgage Task Force. Once a tip is received, detectives review the hundreds of documents that go along with real estate loans and closings. The investigations may take months to years depending on the complexity of the case. The number of tips and complaints have nearly doubled since the inception of the task force. Bear in mind that the statute of limitations for mortgage fraud is 5 years. This gives law enforcement a significant amount of time to bring mortgage fraud cases to court for prosecution.

Task Force Crackdown on Miami Mortgage Fraud, 24-7 Press Release.com, June 26, 2010.

The Florida legislature has increased the requirements for mortgage brokers who apply or seek to renew their licenses. The legislature enacted the law in an effort to curb the ongoing problem of mortgage fraud occurring in the Miami and South Florida area. No mortgage broker applications under the old standards will be accepted after July 8, 2010. On October 1, 2010, all mortgage brokers, loan originators, and mortgage business owners will be required to file under the new rules after Florida joins the Nationwide Mortgage Licensing System. Individuals that wait until after July 8th, will have to wait for several months under the new rules to receive their licenses. As a Miami criminal lawyer representing defendants charged in numerous mortgage fraud cases, it is understandable why the legislature acted.

The new rules will require that people applying and even renewing licenses will be require to undergo annual criminal history and credit report checks. The current licensing requirements were too relaxed according the legislature. Under the current rules, an applicant was required to undergo an initial background check and could renew their licenses every two years without a criminal background check. If mortgage brokers were arrested on criminal charges, it was their obligation to report themselves to licensing department.

According to the Mortgage Asset Research Institute, the licensing changes were necessary as Florida leads the nation in mortgage fraud. The changes in the licensing polices come at time when the media continues to report on the fraud that has caused serious economic difficulties in Florida and across the United States. In fact, it is believed that the legislature acted in response to a Miami Herald article. The article explained that mortgage licenses were issued to individuals with prior criminal histories such as convictions for armed robbery and cocaine trafficking. Once that information became public knowledge, the legislators acted.

The new licensing laws also set out the penalties if a broker is convicted of a certain criminal offense. Lifetime disqualification will occur for anyone convicted of the following offenses: fraud, robbery, identity theft, burglary or tax fraud. Convictions for other criminal offenses allow for five, seven and 15 years license suspensions. Anyone required to have a mortgage broker license must be keenly aware of the ramifications of being arrested for criminal charges. Any mortgage broker or lender that has pending criminal charges must seek legal representation from an experienced Miami criminal defense lawyer because the entry of any type of pleas, as harmless as it might seem, could cause someone to lose their livelihood.

Mortgage Broker Licensing Rules to Get Tougher, The Miami Herald.com, June 24, 2010.

The federal government is once again attacking the mortgage fraud problem that brought this nation's economy to its knees. A large-scale multi-agency investigation into mortgage fraud netted 86 people in South Florida as part of a nationwide crackdown. The United States Attorney's Office for the Southern District of Florida announced that "Operation Stolen Dreams" was a huge success. The defendants arrested are charged with filing for and receiving fraudulent loans in the amount of $76 million. Mortgage and real estate brokers, straw buyers, loan and title processors, as well as, lawyers were arrested. As the federal government continues to investigate and prosecute defendants for mortgage fraud, Miami criminal defense lawyers have their hands full defending clients charged with these types of offenses.

Many of the defendants charged as a result of this operation have entered guilty pleas while others await trial in federal court. United States Attorney for the Southern District of Florida announced the results of the mortgage fraud crackdown and said, "The unscrupulous actions of individuals ands companies who abuse the financial system and the trust of others for their own financial gain are immoral and illegal." Despite the fact that mortgage fraud is on the decline due to additional safeguards implemented by financial lending institutions, the system of checks and balances still miss a variety of fraudulent schemes used to obtain mortgages illegally.

In one the cases, a Haitian-American defendant put herself out as a person who could assist individuals in obtain loans. As part of her scheme, she obtained the personal information of individuals and used the information to fraudulently purchase various real estate. The defendant would used the personal information to obtain loans and purchase the property. She would then transfer the property to her name using quitclaim deeds. She has been charged for numerous counts of aggravated identity theft. She is scheduled to make her first appearance in court which will be followed by a pre-trial detention hearing. A federal magistrate will review the evidence to determine if and how much of bond will be set in the case.

In another federal case, eleven defendant were arrested for a scheme that defrauded nine financial lending institutions out of approximately $11 million to purchase 15 pieces of property. The defendants in the case included a mortgage broker, real estate broker, straw buyers and a loan processor. Another case netted thirteen defendants including loan officers, straw buyers and a title agent. They are accused of working in concert causing a loss of $9.7. While the facts of each case are different, the schemes being uncovered all follow a similar pattern.

Federal investigators have promised that these are not the last arrests to made. If you ro someone you know is being investigated for or has been arrested in a Miami mortgage fraud scheme, contact a Miami criminal lawyer experienced in defending these types of cases in federal court. To date, "Operation Stolen Dreams" have led to over 1,200 arrests involving more than $2.3 billion in losses.

Steal a Dream? Feds Watching, The Miami Herald, June 18, 2010.

A former lawyer appeared in federal court last week for his sentencing hearing. All of South Florida has been following this case since the investigation began regarding Scott Rothstein's multi-million dollar Ponzi scheme. Rothstein previously entered guilty pleas to the following charges: bank fraud, wire fraud and money laundering. The charges stem from a $1.2 million Ponzi scheme which purportedly defrauded investors. The victims invested money in lawsuit settlements. At the forefront of the organized scheme to defraud was his South Florida law firm, Rothstein, Rosenfeldt and Adler. Government prosecutors requested that the federal judge sentence Rothstein to 40 years in prison while his criminal lawyer requested that the court sentence him to 30 years. The pre-sentence investigation report submitted by the federal probation office suggested life in prison. After hearing arguments from all of the parties, the federal judge sentenced him to 50 years.

While 50 years is a long time to spend in prison, Rothstein's cooperation significantly reduced his exposure which was up to 100 years of incarceration. Federal prosecutors went to bat for Rothstein claiming that his cooperation regarding the fraud surrounding his case and his work as a confidential informant was extraordinary. His actions as a confidential informant led to the arrest of a purported Mafia boss engaged in organized crime, money laundering and drug trafficking. As a result of his cooperation with federal law enforcement and prosecutors, a 5K was filed on his behalf. The prosecution can file a 5K when a defendant significantly assists them in the case for which the defendant was charged and when the defendant assists in other law enforcement investigations. Normally a 5K will significantly reduce a defendant's sentence in federal court, however, Rothstein's alleged crimes were so reprehensible due to the nature of the fraud and the amount of loss the 5K could not allow for a sentence in the single digits.

The amount of loss in the case was so significant that it raised Rothstein's possible sentence by 30 levels under the federal sentencing guidelines. As such, the 5K could only reduce his sentence to a certain extent. The good news for Rothstein is that if he continues to cooperate, the federal prosecutors can ask for a further sentence reduction at a later date. Even with a motion to reduce the sentence, the federal judge hearing the matter is unlikely to reduce the sentence much more. The sentence reduction hearing will not occur for sometime as he will be required to testify in criminal as well as civil cases for the foreseeable future.

The massive fraud involved targeting friends and clients alike; to invest in fraudulent civil court settlements. Although the head the of the law firm, Rothstein claims that he acted with plenty of co-conspirators and that without their help could not have operated such a large scheme to defraud. In fact, he provided information that led to the arrest and indictment of Debra Villegas, the firm's chief operating officer. Villegas entered a guilty plea Friday as a result of Rothstein's cooperation. The sentencing hearing, like so many involving Ponzi schemes at least provide closure for the defendant and his victims.

Florida Lawyer Given 50 Years in Prison for Ponzi Scheme, Bloomberg Businessweek.com, June 9, 2010.

Law enforcement and prosecutors continue to ramp up efforts to investigate and bring charges against those involved in mortgage fraud. As discussed in recent blogs, the federal government has created mortgage fraud task forces for regions hit hard by those committing mortgage fraud. The Miami-Dade County State Attorney's Office has just followed suit by starting its own mortgage fraud unit. The unit will be staffed by five experienced prosecutors. Prior to the creation of this unit, the state attorney's office had only three specialized units dealing with fraud which were insurance fraud (staged accidents), worker's compensation fraud, and the economic crimes unit. Prior to the formation of the mortgage fraud division, the state wide prosecutor's office was solely responsible for these types of cases. The creation of this specialized division will create further work for Miami criminal defense lawyers practicing in state court.

Along with the five prosecutors, the new division will be staffed with paralegals, support personal and a forensic accountant. The current Miami-Dade State Attorney saw the need for the creation of the mortgage fraud division, but realized that the cases were far to complex for inexperienced prosecutors to handle effectively. Miami and South Florida have garnered a lot of media attention for the large amount of mortgage fraud committed in the area. Dozens of arrests and prosecutions for mortgage fraud make the newspaper every month. With all this mind, individuals involved in mortgage fraud face criminal charges that can now be brought by three prosecutorial agencies.

The most recently mentioned cases of mortgage fraud involved South Florida companies called TopDot Mortgage and Infinity Mortgage Solutions. TopDot Mortgage was a Boca Raton based operation that saw the arrests of two branch managers, a lawyer, a bank executive and a straw buyer. All of the defendant face long periods of incarceration as several lending institutions lost millions of dollars as a result of the scheme to defraud. The case involving Infinity Mortgage Solutions involved six Miami-Dade residents that were involved in a $5 million scheme to defraud.

Investigations into mortgage fraud involve hundreds of pages of documents and numerous suspects and witnesses. The voluminous amounts of evidence leads to investigations that can take years to complete. If anyone becomes aware that they are the subject of a criminal investigation involving mortgage fraud, it is imperative to seek out Miami criminal attorneys that have experience in defending these types of matters both in state and federal court. It is important to retain counsel as soon as possible so that you will know and protect your rights from the inception of the investigation. Always remember, never speak with law enforcement officers outside the presence of a criminal defense lawyer because any statements made, as innocuous as they may seem, may give the prosecution just enough evidence to file criminal charges.

Dade State Attorney Creates Mortgage Fraud Unit, South Florida Business Journal, May 27, 2010.

Despite the efforts of the federal government including the Mortgage Fraud Task Force, incidents of mortgage fraud/real estate fraud continue to climb. New regulations and stricter lending policies are still unable to curtail the illegal activity. According to a recent report, reported incidents of mortgage fraud climbed 7% in 2009, however, the number are down from a 28% increase in 2008. Apparently, the money and man hours being thrown at the problem are beginning to pay dividends for the federal government. For the past several years Miami criminal defense lawyers have been representing clients in both state and federal court. The office of the United States Attorney prosecutes the cases in federal court, while the majority of state prosecutions are handles by the statewide prosecutor's office. The local state attorneys' office do not handle many of the cases because the majority of jurisdictions do not have units set up with the requisite training to prosecute these complicated offenses.

The federal government is proclaiming that the slower increase in cases of mortgage fraud is attributable to better reporting and more safeguards to protect the industry. Lending institutions have had a lot to do with fixing the problem by requiring substantial down payments, credit checks, better income verification. The federal government has also assisted in curbing the problem by creating investigative teams such as the Mortgage Fraud Task Force. Many reforms are underway or have already been put in place to fight mortgage fraud. Information sharing and reporting systems are being used to correct the problem. The banks are aware that the previously seen standard types of mortgage fraud will be replaced by more complex schemes in an effort to beat the system.

Surprisingly, Florida has passed Rhode Island as the top state involved with mortgage fraud. Apparently Rhode Island is doing something right as they dropped out of the top ten. Following Florida for the top spots are New York, California, Arizona and Michigan. Eight of the top spots are from the eastern portion of the United States. As Miami and South Florida have become the target for Medicare fraud, they will also continue to be a focal point for real estate fraud. Anyone involved in mortgage fraud should be aware that local, as well as, federal investigators are specifically assigned the task of looking for individuals involved in these types of fraudulent activities. If someone is contacted by local or federal mortgage fraud investigators, they should immediately contact a Miami criminal defense law firm experienced in handling real estate fraud cases. Never speak to law enforcement without being represented by counsel. The majority of mortgage fraud cases are complicated and difficult to prove. Anyone suspected of being involved in a mortgage fraud scheme will only make the case stronger for the prosecution by providing a statement to law enforcement.

The majority of mortgage fraud cases stem from misrepresentations on mortgage applications. The other most popular type of fraud relates to property appraisals. Other cases involve false verifications of deposits, escrow funds or closing costs. In any event, prosecutors are looking to impose harsh sentences on any involved in the aforementioned schemes. If you are being investigated or have been arrested in any one of the frauds mentioned above, it would be in your best interest to hire a lawyer to protect your rights.

Mortgage Fraud Incidents Rise 7% Last Year, The Associated Press, April 26, 2010.

Federal investigators believe they have captured and charged a ring leader of statewide mortgage fraud scheme. Several of her co-conspirators have already entered guilty pleas or went to trial in both state and federal court. Yvette Valdes, a former Homestead mortgage broker, was indicted for falsifying mortgage application, lying to financial lending institutions and keeping the fraudulently obtained money for her own use and benefit. Court papers indicate that she fraudulently obtained money for two properties located in Southwest Miami-Dade County. She appeared in federal court with her criminal defense lawyer. Valdez if formally charged with three counts of wire fraud and is facing up to 30 years in prison.

Valdes was allegedly linked to a banker from New York named Orson Benn. Benn was convicted in 2008 in Polk County for his involvement in multi-million mortgage fraud scheme. He was tried in state court by the statewide prosecutor's office. A jury convicted Benn on racketeering charges and he was sentenced to 18 years in prison. Valdes is accused of brokering in excess of $22 million in loans over a 16 month period for Benn. The majority of the mortgage applications contained fraudulent or misleading information. Like most mortgage fraud cases, the documents inflated buyers incomes and falsifying employment records. Many of the buyers were family members.

Other family members involved are her daughter, her brother and son-in-law. All three worked at her mortgage broker company called Best Choice Mortgage. All three were charged in federal court along with the owner of a title company purportedly involved in the Miami mortgage fraud scheme. The indictment alleges that all of the defendants were involved in one fashion or another in supplying false information to JP Morgan Chase Bank. The bank provided in excess of $500,000 to fund the purpose of two properties. The prosecution alleges that the funds were used for their personal benefit.

Valdez first became a suspect in 2005, but state regulators never pursued a criminal case against her. Mortgage fraud investigations sometimes take years to reach a courtroom. Mortgage fraud investigators take their time collecting documents and speaking to witnesses prior to bringing the evidence to state or federal prosecutors. Once the prosecution has been presented the evidence, they look at everything before filing charges. The federal government and the statewide prosecutors have created specialized mortgage fraud units to handle the cases. Despite the specialized units, the vast amount of mortgage fraud cases being prosecuted in Miami and South Florida also cause a delay in the bringing of charges.

Because of the media attention and problems that mortgage fraud has caused the economy, state and federal budgets have allowed for large amounts of money and manpower to prosecute mortgage fraud cases. While indictments are being brought weekly, the number of cases is sure to slow down as the banks have tightened up their lending polices. If someone is being investigated for or has arrested for being involved in a mortgage fraud scheme, it is imperative to seek the advice from a criminal law firm that practices mortgage fraud defense both in state or federal court.

Homestead Mortgage Broker Charged with Fraud, The Miami Herald, May 11, 2010.

Identity theft affects all current walks of life causing serious consequences for the victims of this growing fraud crime. More and more, social security numbers of innocent victims are falling into the hands of the wrong people. Once a person's social security number falls into the wrong hands, it can seriously affect a person's credit history. South Florida and Miami have become a hotbed for identity theft. In fact, in 2009, in excess of 22,000 identity theft complaints were made in the State of Florida. According to the Federal Trade Commission (FTC), Florida has taken over the leader in identity theft, as is the case with Medicare fraud and mortgage fraud. The federal government is taking identity theft cases very seriously. The legislature recently amended the identity theft statute to include more serious charges dubbed aggravated identity theft. Aggravated identity theft carries a two year minimum mandatory prison sentence. If you or someone you know has been charged with identity theft, contact a Miami criminal defense law firm with experience if federal court to assist in defending the case.

Investigations have revealed the social security numbers can be compromised in a multitude of ways. Individuals can gain access to social security numbers from the internet, crooked healthcare clinics, department of motor vehicle employees looking to make a buck, or from the trash. While social security numbers have been used in the past to commit credit card fraud or mortgage fraud, it appears that undocumented workers are paying for the fraudulent numbers to gain work. Even companies are using the stolen numbers to make workers look legitimate. The stolen social security numbers are also being used to commit worker's compensation fraud.

A current case being investigated by the federal authorities involves an 18 year-old college student. The feds don't know how the social number was acquired, but they do know that dozens of blue collar workers have used the number to obtain employment in Palm Beach, Broward and Miami-Dade Counties. According to reports cities with large immigrant populations have had the largest number of reported identity thefts in the country. Typically, individuals looking for work will pay up top $200 for the illegally obtained social security numbers. The sad part is that the people making the purchases are simply trying to feed their families with out considering the long term difficulties being caused to the real social security number holders.

South Florida and Miami have become the recent target of numerous fraud related offenses including credit card fraud, mortgage fraud and Medicare fraud. Now identity theft can be added to the list being looked at closely by state and federal law enforcement authorities. While cocaine trafficking and marijuana grow houses used to be the biggest problem affecting the criminal justice system in South Florida, the court dockets are now replete with fraud related offenses. The problem has become so massive the both state and federal prosecutors' office have created specialized departments better suited to deal with the ver increasing problem. While the fraud related offenses used to carry pre-trial diversion or probation offers, the recent media attention are causing criminal lawyers a difficult time getting their reasonable plea offers even if their client s are first-time offenders.

Teens Get a Harsh Lesson in Identity Theft, The Miami Herald, May 8, 2010.