Reported from the Los Angeles Times- Darin McAllister joined the L.A. Police Department in 1991 to later become part of the FBI in 1996 doing undercover work. His career had skyrocketed so he took part in real estate investment market by purchasing a few duplexes and renting them out. All went well until the market crashed and McAllister found himself unable to keep tenants and produce payments. Soon his properties were put into foreclosure and he was notified that he was under investigation due to his inflation of income on mortgage documentation. In May of 2010, he received the charges of 19 counts of wire fraud, false declarations and a few other felonies. The defense stated that McAllister was over his head and did not understand the documentation properly enough to know his wrong doing. McAllister himself claimed he felt he was tricked by inside mortgage professionals, such as loan officers and appraisers, and felt it was a bit out of his control. The final conviction came out at 15 counts of wire fraud and three counts of bankruptcy fraud with four years in prison and a $675,000 fine.
The reason for this posting is to show the severity of mortgage fraud and how important it is to make sure all parties of mortgage transactions understand the documentation. Since the market crash, laws regarding mortgage fraud and misrepresentation have become stronger than ever and for the safety of not only the borrower, but the mortgage professionals as well, it is very important to understand all the fine print.
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