Three former Portland-area mortgage brokers face fraud charges

Originaly by Jeff Manning:  A federal grand jury charged three former Portland-area mortgage brokers with fraud on Wednesday.

Joel D. Surprenant, Michael Duc Han and Benjamin Lucian Lucescu all were charged with one count of obtaining mortgage loans through materially false and fraudulent pretenses.

The three cases were the latest in a wave of mortgage fraud prosecutions across the country that have come to light since the real estate boom has turned to bust. The FBI is investigating thousands of cases, many referred to them by lenders or loan servicing companies.

Falsifying a loan application was easy and common during the mortgage boom. So-called stated-income loans in which lenders made little if any effort to check out a borrowers true financial condition became an accepted part of the industry.

But now that the boom has gone bust, some of the same lenders that turned a blind eye during the good times are aggressively referring defaulted loans to law enforcement.

The local U.S. Attorneys office has devised a streamlined procedure to handle the load. These cases are coming in significant numbers, said Lance Caldwell, assistant U.S. attorney in Portland. Caldwell estimated the Portland office could ultimately handle a dozen to several dozen similar mortgage cases.

Surprenant worked for Morgan Financial. The Grand Jury accused him of submitting a mortgage loan application in August 2006 on his own behalf in which he inflated his income with false documents, including fake pay stubs. Surprenant inflated the sale price of the residence he was buying in order to receive a kickback from the seller at the close of the transaction, the government claims.

Han worked for TTM Finance. He allegedly submitted a mortgage application in February 2007 that falsified the borrowers financial qualifications.

Lucescu worked for American Capital Mortgage Corp. in Gresham. Between March 2004 and June 2007, he allegedly arranged for five different loans on behalf of the same borrower, falsifying her assets and liabilities.

Lucescu indicated that the homes were to be primary residences when they were actually investments, the government claims.

Penalties in white-collar criminal cases are based largely on the degree of financial losses. As the real estate market has slumped, many homes purchased during the mortgage boom are now underwater, meaning they are worth less than the debt owed.

Under federal sentencing guidelines, prosecutors will generally argue for jail time if the difference between the mortgage debt owed and the market value of the house exceeds $40,000.