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United States v. Alam
United States District Court, D. Kansas
July 22, 2014
UNITED STATES OF AMERICA, Plaintiff,
MANJUR ALAM, Defendant.
SENTENCING MEMORANDUM and RULE 32(h) NOTICE
MONTI L. BELOT, District Judge.
Before the court are the following:
1. Presentence report (Doc. 121);
2. Defendant's 30-page objections to PSR (Doc. 123);
3. Defendant's 36-page sentencing memorandum (Doc. 124);
4. Government's response to objections (Doc. 125);
5. Court's letter of June 19, 2014 (Doc. 129);
6. Government's response (Doc. 130); and
7. Defendant's reply (Doc. 128).
A hearing was held on April 21, 2014. The parties proceeded by proffer and argument.
In Case No. 05-10253, defendant, along with several co-defendants, was charged with various offenses, including wire fraud and conspiracy generally relating to HUD fraud. Defendant entered a plea to conspiracy to defraud HUD and was sentenced to probation. Undeterred (or perhaps emboldened) by this lenient sentence, defendant and six co-defendants began committing the acts giving rise to this case. The PSR describes the criminal conduct in (unobjected-to) detail. The overall scheme is set out in PSR paragraphs 31-33 and 35-40 as follows:
31. The defendants in this scheme defrauded FDIC mortgage lenders, Fannie Mae and Freddie Mac and the United States Department of Housing and Urban Development (HUD) by utilizing nominal buyers to purchase homes that were HUD qualified. This scheme to defraud submitted materially false loan applications to lenders and created false supporting documentation that opened accounts at financial institutions for the sole purpose of receiving and transferring proceeds from the scheme.
32. At the time of the scheme, Manjur Alam had his realtor license suspended, was on probation after a Federal conviction, and was prohibited from participating in any federal programs, including housing programs. Mr. Alam used "nominal sellers" to purchase homes and flip the properties to "nominal buyers." Mr. ALAM lured the "nominal sellers" with promises of quick and easy profits, while he recruited "nominal buyers" with the prospect of using the houses as investments while promising them kickbacks.
33. Bruce Dykes, Christopher Ginyard, Henry Pearson, Sr., Henry Pearson, Jr., Steven Pelz, and Janice Young were "nominal buyers" recruited by Mr. ALAM to purchase homes as rental properties. None of the nominal buyers used the homes as their primary residence, yet each indicated in the loan application that the homes would be a primary residence. Each of these defendants were unqualified to receive mortgage loans for the homes purchased, and each of these defendants made false statements in their applications for those loans.
35. It was further part of the scheme that Mr. Alam recruited sellers from his homeland of Bangladesh. Manjur Alam identified properties for the sellers to purchase and flip to buyers. Mr. ALAM told the sellers he would do most of the repairs on the properties and pay for the repairs before the sale. Manjur Alam would bill the sellers at the time of closing for the repairs, and he and the sellers would split the expenses and profits at the time of closing. Manjur Alam would not fully document the repair expenses, often inflating the expenses, and thereby taking an inflated share of the profit. Mr. Alam would also create fictitious invoices for repairs that were not completed. Manjur Alam only made minor cosmetic repairs leaving many properties with mechanical or structural issues.
36. Manjur Alam recruited the "nominal buyers, " often having identified concurrently with the "nominal seller." Mr. Alam told the "nominal buyers" they could be landlords of the properties and Mr. Alam would help by finding renters. Manjur Alam promised to make payments to the buyers for purchasing the houses. Mr. Alam assisted the "nominal buyers" in obtaining loans to purchase the properties. Manjur Alam prepared the paperwork, including false Uniform Residential Loan Application(s) (URLA) for the "nominal buyers". Mr. Alam identified the property for them to purchase, and directed the "nominal buyers" to loan officers. Manjur Alam provided other false paperwork to the lending institutions to facilitate the "nominal buyers" receiving the loans. Mr. Alam guided each "nominal buyer" through the purchase process, acting as the buyer and seller agent. Mr. Alam had his realtor license suspended in July 2007, and falsely represented his wife as the realtor while, in fact, he acted as the realtor.
37. Manjur Alam instructed each "nominal buyer" to apply for multiple loans, with the exception of Henry Pearson, Sr. and Janice Young. Henry Pearson, Sr. and Janice Young only made one loan application. However, each of the uniform residential loan applications (URLAs) indicates the borrower(s) intended to occupy the residence as a primary residence, and the nominal buyers signed the URLAs and occupancy certifications indicating the same. The nominal buyers did so at the direction of Manjur Alam. The nominal buyers did not occupy the residences as primary residences, but intended to use them as rental properties in accordance with the scheme created by Mr. Alam.
38. The lenders require Verification of Employment (VOEs) to insure the borrowers are employed and able to make monthly mortgage payments. Mr. Alam caused false VOEs to be created for the "nominal buyers" and be submitted to the lending institutions during the loan application.
39. The lenders require Verifications of Rent (VORs) to determine if borrowers can afford mortgage payments. Manjur Alam caused false VORs to be created for the "nominal buyers" and be submitted to the lending institutions during the loan application.
40. Prior to the nominal buyers closing on the properties, Mr. Alam and/or the nominal buyers would submit invoices for repairs to title companies for property improvements. The invoices were from companies that did not exist, or for repairs that were not completed or vastly overstated. Manjur Alam would represent the false or inflated repair expenses to the "nominal sellers" as actual expenses. Thus, Mr. Alam would take a greater share of the profits of the home sales. Manjur Alam would take his portion of the profits after expenses, ...
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