Osceola, Florida Man Pleads Guilty to Mortgage Fraud Scheme

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Scheme involved flipping properties and enticing buyers with promises of fraudulently obtained financing

August 30, 2007 -- TALLAHASSEE, FL - Florida Attorney General Bill McCollum today announced that an Osceola County man pled guilty to multiple criminal charges stemming from a widespread mortgage fraud scheme that targeted first-time home buyers or individuals with low income or poor credit. Leandro Obenauer will be sentenced to five years in prison to be followed by 15 years probation when he is sentenced later in September and will have to make restitution to several families who were victimized by the scheme. He was prosecuted by the Attorney General’s Office of Statewide Prosecution.

“Not only did this individual defraud numerous home buyers and lenders, he created uncertainty and instability in the home-buying market,” said Attorney General McCollum, who also expressed sincere concern about the rising trends in mortgage fraud throughout the state.

Obenauer, 38, was involved in a scheme to purchase low-value properties at a discount, and then resell them at inflated prices while pretending to represent the property owners. He and several co-conspirators defrauded lenders by using straw buyers whose credit information he obtained in exchange for payment and by submitting fraudulent documents to secure the loans. Obenauer also victimized subsequent buyers by misrepresenting property values and placing many of these buyers in loans for which they did not legitimately qualify and which they could not afford to repay. The investigation was conducted by the Office of Financial Regulation (OFR).

“Consumers should not allow anyone to pay for the use of their credit to obtain loans on properties they do not intend to own or maintain,” said Don Saxon, Commissioner of the OFR. Commissioner Saxon also recognized the efforts of the Attorney General’s Office of Statewide Prosecution and expressed gratitude for their cooperation and diligent handling of this case.

Florida Chief Financial Officer Alex Sink, who along with Attorney General McCollum sits on the Financial Services Commission that oversees the OFR, urged consumers to take time to understand what they are signing and call the Department of Financial Services (DFS) for assistance. “Consumers can call our consumer helpline or log on to MyFloridaCFO.com and get information that can help them make informed decisions,” said CFO Sink. The DFS Consumer Helpline is 1-800-342-2762 and any cases of suspected fraud will be referred to the OFR.

Obenauer was arrested by agents with the Florida Department of Law Enforcement in 2004 following the investigation conducted by the OFR. He pled guilty to conspiracy to commit racketeering and grand theft over $100,000, both first-degree felonies, as well as four additional counts of third-degree grand theft. As part of his sentence, Obenauer will be required to deposit $50,000 with the Osceola County Clerk of Court at the time of his sentence as an initial payment towards restitution. Obenauer may also be required to testify in the trial of his co-defendant, Robert Merchant, Sr., who is facing charges of racketeering, organized fraud, unlicensed mortgage brokering and grand theft.

Source: Florida Attorney General