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Elliot Spitzer filed criminal charges against Louis and Michael Sandella, two New York men who defrauded mortgage companies out of millions of dollars over the past 5 years. The banking commission, Attorney Generals office, and the Organized Crime unit investigated these crimes that occurred in Brooklyn, Queens, and Suffolk Counties.

In an 83-count criminal indictment, Spitzer alleged that two New York men, brothers Louis and Michael Sandella, led a group that submitted “hundreds” of falsified residential mortgage applications from 2001 until recently.
With the help of real estate attorneys, appraisers and individuals who posed as buyers, the Sandellas would seek a loan far more than needed to purchase a property. They’d purchase the property under the name of a “straw buyer” and then pocket the difference — sometimes $100,000 or more per transaction.
Dozens of straw buyers were paid to participate — usually a few thousand dollars — by lending their names to the real estate transaction with the promise the Sandellas would keep up payments on the loan. But ultimately, Spitzer charged, the Sandella group would stop paying off the loans, leaving the straw buyers accountable for the default and the banks stuck with bad loans.
Spitzer and New York Banking Superintendent Diana Taylor declined to identify those victimized by the fraud and said it was difficult to detail the values stolen or the actual difference pocketed by the group. Spitzer only offered that the group probably stole “tens of tens of millions.”
The properties were in the Brooklyn and Queens sections of New York city and nearby Suffolk County. The indictments were unsealed in Brooklyn State Court on Tuesday.
In addition to the Sandellas, prosecutors secured indictments of Danielle Moss, Kim Moss Fontanez, Geraldine Moss, Gary Shaw and Ida D’Angelo. The seven were in custody early Tuesday afternoon and were awaiting arraignment, Spitzer said at a news conference. via  Reuters.com.

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