Flemington attorney pleads guilty in Wildwood Crest mortgage fraud

Attention: open in a new window. PrintE-mail

CAMDEN – A Flemington lawyer pleaded guilty Thursday, July 9 to participating in a mortgage fraud scheme that involved overbuilt condos in Wildwood Crest, U.S. Attorney Paul Fishman announced.

Joseph W. Witkowski, 68, pleaded guilty before U.S. District Judge Joseph E. Irenas in Camden federal court to an indictment charging him with one count each of conspiracy to commit wire fraud and conspiracy to commit money laundering. Witkowski, a former attorney, was released on bail.

Witkowksi admitted he conspired to participate in a scheme that caused lenders to release $40.8 million based on fraudulent mortgage loan applications and conspired to launder the proceeds of the fraud, Fishman said.

To date, 10 of Witkowski’s conspirators have pleaded guilty to participating in this mortgage fraud conspiracy, including Charles Harvath, Stephen F. Corba Jr., John Siuszko, Michael Williams, William Brown, Mark Kreischer, Crystal Brame, Aku I. Muhammad, George Lachenmayr Jr. and Robert Serao.

According to court documents, Witkowski and his conspirators located oceanfront condominiums overbuilt by financially distressed developers in Wildwood Crest, real estate in vacation destinations in Georgia and South Carolina, and properties in New Jersey owned by financially distressed homeowners facing foreclosure. They then recruited “straw buyers” – people with good credit scores but lacking the financial resources to qualify for mortgage loans – to purchase those properties.

Witkowski and his conspirators created false documents, including fake W-2 forms, income tax returns, investment statements, and rental agreements, to make the straw buyers appear more creditworthy than they actually were, Fishman said.

They also established numerous telephone lines for companies owned by some of the conspirators so that when a lender contacted the telephone number, the conspirators could falsely verify that a straw buyer was employed by the company listed on his or her fraudulent loan application.

Court documents state Witkowski also caused fraudulent mortgage loan applications in the name of the straw buyers and supporting documents, which attributed to the straw buyers inflated income and assets, to be submitted to mortgage lenders. Once the loans were approved and the mortgage lenders sent the loan proceeds in connection with real estate closings on the properties, Witkowski and his conspirators had some of the funds wired or checks deposited into various accounts that he and his conspirators controlled.

The wire fraud conspiracy charge to which Witkowski pleaded guilty carries a maximum potential 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. Witkowski has agreed to forfeit $2,412,899, representing the proceeds of the fraud.

Sentencing is scheduled for Nov. 14, 2014.

blog comments powered by Disqus