5 Busted in $33M Mortgage Scam in Putnam and Westchester Counties

5 people who were accused of mortgage fraud that cheated seniors and banks were indicted in court this past Thursday.

According to justice.gov., the company, Terra Foundation, targeted senior citizens in Putnam and Westchester counties and in Connecticut by promising them they could eliminate their mortgage debt for a fee. Each of the 5 is now under indictment for conspiracy to commit bank fraud, wire fraud, and mail fraud which carries a maximum penalty of 30 years in prison and a $1 million fine. They were masters at talking their clients into taking out second or reverse mortgages while telling these same clients they had discharged their first mortgage. Once the client actually signed the papers, Terra kept a large amount of the proceeds.

Here's what I've learned, if it sounds too good to be true, in most cases, it is. Always, always consult with someone who's an expert in the field before signing anything. In all, Terra defendants filed 60 discharges making a profit of $33 million. The business made it a point of soliciting who were having trouble making their mortgage payments.

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