More mortgage fraud alleged

Written by Christie Rotondo Friday, February 01, 2013 03:57 pm

WILDWOOD- Four people, three with connections to real estate offices in the Wildwoods, were arrested Thursday for their alleged roles in a $15 million mortgage fraud scheme, according to the U.S. Attorney General Paul J. Fishman.

According to the Attorney General’s office, Fredric M. DiAntonio, 40, of Wildwood and Louis V. Catarro, 60, of Runnemede were among those arrested. Both are co-owners of Blue Ocean Reality on New Jersey Avenue in Wildwood.

Kathryn W. Lockwood, 43, of Wildwood Crest, and Thomas E. Morello, 55, of Mt. Laurel were also arrested.

According to the indictment, Lockwood is a co-owner of Hoffman Agency North, a real-estate agency in North Wildwood. Morello created Bay Breeze Development, a limited liability company for the development of real estate in North Wildwood, the indictment states.

All defendants were charged with conspiracy to commit wire fraud, according to the Attorney General’s office. Diantonio, Catarro, and Lockwood were also charged with conspiracy to commit money laundering.  In addition, Diantonio and Catarro were charged with making false statements to the U.S. Department of Housing and Urban Development. The defendants are expected to appear in today before U.S. Magistrate Judge Karen M. Williams in Camden federal court.

According to the indictment, real-estate agents Diantonio, Catarro, and Lockwood found properties in North Wildwood and Wildwood, for sale by developers, like Morello. The agents then created real estate sales contracts, which stated that funds were deposited by buyers. However, the indictment states that these funds were not often collected. The defendants also agreed that sellers such as Morello would pay kickbacks to the buyers of the properties without disclosing the kickbacks to the lending institutions funding mortgages used by the buyers to purchase the properties.

The defendants then drew up illegitimate documents to be signed at real estate closings such as U.S. Department of Housing and Urban Development (HUD) settlement statements, which did not disclose the kickbacks paid to the buyers or falsely stated that a deposit toward the property had been collected, the indictment states.

A similar mortgage scheme in the Wildwoods was alleged by federal agencies in July 2012, resulting in the arrest of 11 people, including former Lower Township Public Defender Seth Fuscellero, of Wildwood Crest.

According to the recent indictment, the object of this conspiracy was to profit from the sale of oceanfront condos overbuilt by financially distressed developers in Wildwood and North Wildwood by obtaining mortgage loans for unqualified buyers using fraudulent loan applications, HUD settlement statements, and other documents.

Attempts to reach Diantonio and Catarro were unsuccessful Friday. A receptionist at Blue Ocean Reality forwarded all questions to the agent’s attorneys.

According to the U.S. Attorney General’s office, the wire fraud conspiracy charge is punishable by a maximum penalty of 30 years in prison and a $1 million fine.  The money laundering conspiracy charge carries a maximum potential penalty of 10 years in prison and a $250,000 fine.  The false statements charge carries a maximum potential penalty of two years in prison and a $250,000 fine.