From October 2006 to November 2009, a New Jersey woman and her parents operated a sophisticated mortgage equity fraud scheme that allegedly resulted in losses of around $3.8 million to mortgage lenders.
Last October, the family and three other co-conspirators were charged with mortgage fraud, following an investigation by the Federal Bureau of Investigation, the United States Postal Inspection Service and the Internal Revenue Service’s Criminal Investigations branch.
The family of fraudsters stood accused in a Pennsylvania court of targeting families on the edge of default and persuading them to refinance their loans in a lease-buyback program. However, instead of helping the families, Silver Buckman and her parents, Vincent Foxworth and Cynthia Foxworth, appropriated the funds and stripped any equity the victims had in their property.
The defendants induced the homeowners into signing documents related to the sale and lease of their homes by their representations that the homeowners would remain on the title to their homes, that the equity from their homes would be placed into an individual escrow account in their names, and that new mortgages would be paid from the escrow accounts to establish their timely payment histories.
The family allegedly then falsified financial and information documents to prop up straw investors that could take out mortgage loans for the victims, then diverted the proceeds, allegedly paying only small sums on the mortgages they had taken out, with the new loans ending up in default.
Prosecutors say that no funds were put into escrow accounts. Instead, they were distributed among the defendants. Buckman used most of the proceeds to pay the straw borrowers, downpayments for the straw borrowers to keep the fraud going and her own personal expenses, according to the indictment.
Buckman operated the scheme through her company, Fresh Start Financial Services. She also worked at American Home Lending and American One Mortgage. According to the indictment, Buckman brought her parents Vincent, an experienced Realtor with Century 21, and Cynthia Foxworth to be straw borrowers. Buckman and Franklin Busi, Buckman’s business associate, also submitted false financial and employment information to mortgages, after which Buckman cut the homeowners out of settlement proceeds.
The trio faces 87 to 108 months in prison following their conviction on charges of wire fraud, bank fraud and conspiracy to commit fraud.