The United States Department of Justice (USDOJ) announced this past week that a husband and wife from the New York area were convicted of bank fraud, conspiracy to commit bank fraud and Medicaid fraud by a federal jury.
The defendants Joseph Atias and Sofia Atias devised a short sale scam in order to discharge their mortgage debt. The mortgage was held by Bank of America who they defrauded of over half a million dollars in connection with the sale of property adjacent to Sacred Heart Academy for $925,000. The property was sold via short sale for $480,000.
According to the USDOJ, in the short sale process, the defendants submitted a fraudulent contract of sale and other documents with false statements to Bank of America which they used to approve the sale of the property. They also utilized a straw buyer to create the appearance of an arms-length sale.
The defendants knew that the Sacred Heart Academy had planned to purchase the property at the full value of $925,000 and shortly after they acquired the property, the defendant’s straw buyer sold it to Sacred Heart Academy for approximately half a million dollars in profit.
The USDOJ said that Mr. and Mrs. Atias also committed Medicaid fraud for the theft of government funds in connection with their receipt of hundreds of thousands of dollars in Medicaid funds from 2009-2015.
The defendants face penalties of up to 35 years’ imprisonment, the forfeiture of $560,000, and restitution of over $700,000. After the verdicts, Joseph Atias was remanded to custody pending sentencing by United States District Judge Denis R. Hurley.
“Through a web of lies and false documentation, these defendants stole more than half a million dollars from Bank of America and from Medicaid, which they used to line their own pockets,” stated Acting United States Attorney Rohde. “The fine work of the FBI to bring these defendants to account for these crimes sends a clear message to anyone who contemplates engaging in mortgage fraud or Medicaid fraud: Do not even attempt it, because you will be caught and held responsible.” Ms. Rohde extended her grateful appreciation to the Federal Bureau of Investigation, the agency responsible for leading the government’s investigation.
The government’s case was prosecuted by Assistant United States Attorneys Charles P. Kelly and Burton T. Ryan, Jr. of the Office’s Long Island Criminal Division.