Miami mortgage fraud indictment alleges properties used as marijuana grow houses

Federal authorities have indictment six men on real estate fraud charges in Miami for allegedly participating in a scam that used profits from mortgage fraud to buy marijuana grow houses, the South Florida Business Journal reported.

Barakat, Jacobs & Associate’s focus on criminal defense in Miami and mortgage fraud in South Florida put the firm in a unique position to defend such cases. The number of mortgage fraud allegations has skyrocketed since the economic downturn. And in many of these cases the defendants are guilty of nothing more than making poor real estate investments. Marijuana grow houses are also a significant issue in South Florida and the availability of vacant real estate has led to squatters, renters and others who have been charged with operating grow houses. However, it is frequently the landlord or property owner who faces forfeiture of their property or even criminal charges. Hiring a Miami criminal defense attorney is a critical step to protecting your rights as a property owner.

In this case, the six defendants face 44 separate criminal charges, including conspiracy to commit mail fraud, mail fraud and money laundering. Ranging in age from 36 to 62, they face 20 to 40 years in prison if convicted. Authorities say the case started with grow-house arrests in Port St. Lucie in 2006. Investigators subsequently found grow houses operating in Palm Beach and Miami-Dade counties.

The indictment alleges that most of the properties were obtained through mortgage fraud committed by one of the defendants, who owed a mortgage company. The defendants allegedly submitted loan applications to mortgage lenders that contained false information. They also used false bank statements, W2 forms, pay stubs, verifications of deposit and verifications of employment.

The Palm Beach Post reported the group paid $370,000 for a house that had traded three months earlier for $232,200. In another case, the group allegedly flipped a property among themselves, buying for $370,000 and selling for $420,000.