An Oceanside mortgage broker has been accused of leading 13 people, mostly Long Islanders, in a $58 million mortgage fraud scheme involving more than 100 homes across the New York metro area.
Federal prosecutors said 50-year-old Gerard Canino of Merrick, owner of First Class Equities on Long Beach Road, recruited so-called “straw buyers” to secure loans for the sham real estate deals by submitting fraudulent applications to banks and lenders between 2004 and 2009.
“This brazen and wide-ranging scheme defrauded banks and lenders of millions and enriched its participants, including real estate professionals who took advantage of their inside knowledge of the system to fleece it,” Assistant U.S. Attorney Preet Bharara said in a statement.
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The suspects were scheduled to be arraigned Thursday at Manhattan federal court before Judge Robert Patterson on charges of conspiracy to commit bank and wire fraud. Two were additionally charged with making false statements to FBI agents.
Those accused include eight Nassau County residents, an East Quogue resident, a Texas man and a New Jersey woman. They include four attorneys, a disbarred lawyer and five loan officers who worked for First Class Equities.
If convicted, each faces up to 30 years in federal prison and a fine of up to $1 million or twice the theft, plus restitution.
One of the straw buyers was paid $300,000 by racking up at least 10 mortgages within a short period of time in 2006, prosecutors said.
Some conspirators allegedly funneled the loan money through shell their corporations, then quickly resold, or “flipped,” the properties to other straw buyers at higher prices, perpetuating the scheme on the same property to steal more money from the lenders.
The residential properties involved were in New York City area, Westchester County, Dutchess County and on Long Island, prosecutors said. Many of the homes are now in default or foreclosure.
Attorney information for Canino was not immediately available.
