Federal prosecutors in Maryland now say a massive Washington area mortgage scheme caused banks to issue $18 million in fraudulent loans, according to an indictment unveiled Tuesday accusing the scheme’s third leader and bank employee for their roles.
On Tuesday, The Examiner reported that one member of the scheme, Bethesda resident Sabrina Weinberg, filed fraudulent loan applications to receive $4.6 million in mortgages, which she used to buy seven properties in the region. Weinberg pleaded guilty to mail fraud charges in November.
But Tuesday’s indictment widens the scope of the scheme. Authorities say the conspirators ripped off area banks for at least $18 million as they bought up approximately 25 properties in the District, Virginia and Maryland. Many of the properties have gone into foreclosure.
Authorities say three men ran the scheme. Timothy Reed, 43, of Beltsville, pleaded guilty Tuesday. Court documents show Terrence White is expected to plead guilty. Now, Osman Sharrieff Al-Bari has been indicted in Maryland’s federal court. The three earned $3.8 million between 2006 and 2008 through the scheme, Reed admitted.
Jamilah Al-Bari, whose relationship to Osman Al-Bar is not specified in court documents, also was indicted. Prosecutors say she used her position as a “business banking liaison” at an M&T Bank branch in Upper Marlboro to create false documents that verified assets for the 15 arranged buyers the scheme used to purchase the properties. The buyers, court documents said, received $10,000 for filing fraudulent mortgage applications and buying the properties.
In one case, Jamilah Al-Bari allegedly sent a letter to a lender verifying that one straw buyer had $9.2 million in assets, when in fact the buyer had no assets, the indictment said. White, Reed and Sharieff Al-Bari, would send Jamilah Al-Bari cash payments disguised as consulting fees, the indictment said.
Calls to M&T Bank were not immediately returned Wednesday.
The three scheme leaders also used their company Brotherly Investment Group to claim they’d performed $515,000 in renovations to Weinberg’s houses that were never done, Reed admitted Tuesday. The renovation claims boosted the value of the homes and the extra cash was kicked back to the trio.
Reed also named Maryland mortgage broker Kara McIntosh as a co-conspirator in his plea agreement. McIntosh was indicted in November, accused of approving the $4.6 million in loans to Weinberg.
McIntosh’s attorney, Stephanie Gallagher, declined to comment on Wednesday.
