Hairstylist and another Man charged with Mortgage Fraud

FBI agents arrested Phil A. Simon as hairstylist in Prospect Heights in Brooklyn with conspiracy to commit wire fraud. Simon and Garth Celestine the other conspirator were both charged in five cases in Bergenfield, Paterson and Elizatbeth, NJ. The maximum sentence if convicted is thirty years in prison and one million dollar fine.

Simon and Celestine are both suspected of similar crimes in Brooklyn, Queens and Staten Island.

The method of mortgage fraud the two men used relates to Straw Buying. The scam goes like this. They contact a homeowner who has equity in their home but is falling behind in the payments. Simon and Celestine come in as the answer to the homeowners’ financial problems. They convince the homeowner to transfer title or deed to a “straw buyer” whom has good credit and qualifies for a cash-out refinance transaction.  The refinance is completed the “straw buyer” is paid off and Simon and Celestine pocket the rest. The home then goes into foreclosure.

Simon and Celestine actually had multiple loans on the same properties in involving several properties throughout New Jersey. The money obtained went into a bank account they named “Keep What’s Yours, Inc.”  Lawyers have estimated that over five million dollars has been scammed by the two mortgage frauds.

Simon and Celestine’s scam has been known by investigators for over a year or more and are just now coming to justice. Law enforcement contends that it takes time to fully investigate the inter workings of such a crime as so many complexities are involved. Several agencies are involved ranging from the FBI to the United States Postal Service.

An FBI official noted that anyone involved in this type of activity would be fully investigated, apprehended, and prosecuted to the fullest extent of the law.  However, the reality is that law enforcement apprehends only about a fraction of the mortgage schemes and deed thefts currently happening in neighborhoods throughout the country. What is surprising about this case is that neither man actually worked as a real estate agent or broker.

One elder woman in East New York with the help of her lawyer was able to regain title on her home recently. Simon and Celestine sold without her knowledge. The mortgage company that holds the mortgage on the property has agreed to arrange a new forty year modified mortgage in her name for her.

Simon and Celestine claim that the media is telling the story one sided and that the charges against them are false. Celestine reports that he intend to write a story call “No Good Deed Goes Unpunished”. Based on the possible sentencing in this case Celestine may have plenty of time to write his book.