The Blotter

Wifredo Ferrer, U.S. attorney for the Southern District of Florida, George Piro, special agent in charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Drew Breakspear, commissioner, Florida Office of Financial Regulation, announce that Karl Oreste, 56, of Miramar, Fla., pled guilty before U.S. District Judge Robert Scola Jr., to one count of conspiracy to commit wire fraud affecting a financial institution. Sentencing has been scheduled for Nov. 14, 2014. At sentencing, Oreste faces a maximum possible statutory sentence of up to 30 years in prison.

Karen Strasser Steinke, 65, of Millstadt, Ill., was sentenced to 21 months imprisonment followed by three years supervised release as a result of her convictions for wire fraud in a scheme to defraud clients of Metro East Title, and structuring of financial transactions to avoid currency transaction reporting requirements, U.S. Attorney for the Southern District of Illinois Stephen Wigginton, announced. Restitution was made in full to the victims prior to the sentencing.

U.S. District Judge Elizabeth Kovachevich sentenced Joseph Daniele, 42, Tampa, Fla., to 10 years and 1 month in federal prison for conspiracy to commit wire fraud. As part of his sentence, the court also entered a money judgment in the amount of $7.46 million. Daniele pleaded guilty on May 29, 2013.

A federal grand jury has recently returned an indictment charging four men in connection with the Split Rock Realty mortgage fraud investigation. On July 9, Thomas Edward Rosensteel III, 41, of Excelsior, Minn., Robert Scott “Rod” Aslesen, 65, of Little Canada, Minn., Justin Joseph Christenson, 34, of East Bethel, Minn., and Dale Russell Wurzinger, 57, of Burnsville, Minn., were each charged with eight counts of wire fraud and one count of conspiracy to commit wire fraud.

Wifredo Ferrer, U.S. attorney for the Southern District of Florida, George Piro, special agent in charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Jason Moran, special agent in charge, Federal Deposit Insurance Corporation (FDIC), Office of Inspector General, Atlanta Regional Office, announce the convictions of Domenico “Dom” Rabuffo, 77 of Miami, Mae Rabuffo, 75, of Fort Lauderdale, and Williston Park, N.Y., Raymond Olivier, 52, of Land O’ Lakes, and Curtis Allen Davis, 51, of Tampa. The defendants were convicted after an 11 day-jury trial before Chief U.S. District Judge Kevin Michael Moore. The jury found each defendant guilty of conspiracy to commit bank fraud and wire fraud affecting a financial institution, in violation of Title 18, U.S. Code, Section 1349. The jury also convicted Domenico Rabuffo, Olivier and Davis of multiple counts of bank fraud, in violation of Title 18, United States Code, Section 1344.

A former N.J. lawyer admitted he conspired to participate in a scheme that caused lenders to release $40.8 million based on fraudulent mortgage loan applications and conspired to launder the proceeds of the fraud, U.S. Attorney Paul Fishman announced. Joseph Witkowski, 68, of Flemington, N.J., pleaded guilty before U.S. District Judge Joseph Irenas in Camden federal court to an indictment charging him with one count each of conspiracy to commit wire fraud and conspiracy to commit money laundering. Witkowski, a former attorney, was released on bail.

U.S. District Judge James Bredar sentenced Rhonda Scott, 52, of Oxon Hill, Md., to 30 months in prison followed by three years of supervised release for conspiring to commit wire fraud in connection with two separate mortgage fraud schemes which resulted in losses of more than $2.5 million. Judge Bredar also entered an order that Scott forfeit $2.7 million and pay restitution of $703,000. Judge Bredar also sentenced co-defendant Niesha Williams, 34, of Fort Washington, Md., to 27 months in prison followed by three years of supervised release for conspiring to commit wire fraud in connection with one of the mortgage fraud schemes. Judge Bredar also ordered that Williams forfeit $3.1 million and pay restitution of $1,445,593.

A federal jury delivered a guilty verdict on June 26against a Charlotte, N.C., man in connection with a $75 million racketeering conspiracy, announced the U.S. Attorney’s Office for the Western District of North Carolina. Following a three-day trial, Steven Jones, 46, was convicted of racketeering conspiracy, securities fraud, wire fraud scheme to defraud investors and money laundering conspiracy. This conviction is the latest in Operation Wax House, an investigation which began in 2007 and has netted 91 defendants to date, 86 of whom have pleaded guilty or been convicted following a trial.

Interthinx, a subsidiary of First American Financial Corp. and a provider of comprehensive risk mitigation solutions for the financial services industry, has released its quarterly interactive Mortgage Fraud Risk Report covering data collected in the first quarter of 2014. In the first quarter of 2014, the national Mortgage Fraud Risk Index value was 100, the same value as it was a year ago and down 1 percent from Q4 2013. The national Property Valuation Fraud Risk Index is 128, up 27 percent from last quarter and 17 percent from a year ago. Indicators suggest this increase is driven by persons in certain areas purchasing and listing multiple properties in the same neighborhood. By controlling those markets, these persons have the ability to artificially control the price of a property to their advantage. Another contributing factor observed is the rise of properties being appraised well above traditional valuation thresholds.

After two days of testimony, a federal jury sitting in Chicago, Illinois has returned a verdict finding Cherron Marie Phillips, who also goes by the name of “River Tali Bey,” 43, guilty of knowingly filing false maritime liens — each in the amount of $100 billion — against the property of current and former federal employees, U.S. Attorney for the Southern District of Illinois Stephen Wigginton, announced.