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More Than 200 Mortgages, $9 Million In Lies

Convictions And Sentences Keep Coming From Waterford Man’s Mortgage Fraud Scheme

Tuesday, 28-year-old Isaura Guzman of New London was sentenced to 37 months in prison for fraud.

But the conviction and sentencing is just one in a line of 15 so far of people involved with a massive mortgage fraud organized by Guzman’s father, Waterford’s Jose Guzman. The scam, which lasted from 2004 to 2007, led to more than 200 fraudulent mortgages equaling more than $9 million in bad loans and a litany of foreclosures across New London County, according to the David Fein, the United States Attorney for the District of Connecticut.

How The Scam Worked

In 2004, Guzman, attorney Maurizio Lancia, Stacey Petro and William Athan, among others, created several mortgage companies with the intention of buying and selling properties, mostly homes in New London County. The goal was to bribe buyers and fool lenders into getting loans for properties for far more than they were worth, with the intention of not paying them back.

The scam would begin with Guzman and his associates telling somebody, generally somebody with good credit but not much income, to buy a property they didn’t intend to live in, with the promise of money later, according to Fein. 

Then that person would apply to mortgage lenders to buy the property with false information such as income, assets, employment, rent history, as well as the borrower's intention to make the property his or her primary residence, according to Fein. In many cases, the loan was approved.

Guzman and his associates would make money off the loan in several ways. First, they would derive large commissions and fees for processing the mortgage. They also would increase the size of the loan with a promise to do work on the property, and then never do work on the property and pocket the cash, according to Fein. Thirdly, and not exclusively, they would rent the properties and keep that income instead of paying off the mortgage, according to Fein. Guzman would also try to sell the properties.

The people who secured the loans were paid as part of the plan as well, and some of those people were convicted and sentenced to prison, according to Fein. For example, Maria Logan was one such buyer who was paid $27,000 for her role in the purchase of five properties, and was convicted and later sentenced in April to two years in prison followed by two years of supervised release, according to a press release from Fein’s office.

Isaura Guzman was part of these scheme as well, recruiting at least three people to act as borrowers and also being involved in the buying and/or selling of four properties, according to a release from Fein’s office.

Lancia was sentenced in April to 27 months in prison, Jose Guzman has plead guilty to charges stemming from the scam and is awaiting sentencing.

nascarblue June 01, 2012 at 11:33 AM
leave them in prison, times are hard enough without some bloodsuckers ripping us off, do not trust anyone involved in mortage anything............
Ron June 01, 2012 at 01:04 PM
Instead of using the Guzman system for mortgage fraud, CT residents should have followed the more lucrative and successful Chris Dodd (34 years of continuous currupt service in the Senate) mortgage formula. Dodd and Guzman have a lot in common as criminals except Dodd was endorsed by the State of CT and Guzman was not. Guzman bilked the mortgage system with help from friends, and Dodd tapped directly into the Countrywide Mortgage VIP Program with the help of friends (he had the CEO in his back pocket). The difference is Guzman got caught, and in time the criminal system dealt with him, whereas Dodd got away with fraud for 34 straight years until the Senate Ethics Committee (an oxymoron), which censured his father, gave this Dodd a pass. Guzman was small potatoes. Chris Dodd did more to destroy the mortgage system and world banking system than any American in history. Justice would be served if Guzman and Dodd could share the same cell, but as fate has it Guzman will do time and Dodd is living the life of a rich baffoon while being paid over a million a year as a Hollywood movie representative, with a pension for life from the taxpayers for his U.S. Senate debacle. Guzman as a CT citizen disgraced New London county...Dodd currupted and disgraced the world.
Insider January 31, 2013 at 05:29 PM
There was not ONE property that was ever purchased with the INTENTION of not paying the mortgage. Shaddy reporting.

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