From U.S. Attorney David Fein:
David B. Fein, United States Attorney for the District of Connecticut, today announced that MARLEEN SHILLINGFORD, 44, of Nesconset, New York, waived her right to indictment and pleaded guilty yesterday, October 12, before United States Magistrate Judge Donna F. Martinez in Hartford to one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering. The charges stem from SHILLINGFORD’s participation in a multimillion-dollar mortgage fraud scheme that involved more than 40 properties located in Bridgeport, Conn.
According to court documents and statements made in court, SHILLINGFORD was involved in the operation of Waikele Properties Corp., a real estate company with offices at 3770 Main Street in Bridgeport and 320 Endo Boulevard in Garden City, N.Y. From approximately 2001 to August 2011, SHILLINGFORD and others conspired to obtain fraudulent mortgages for the purchase of more than 40 multi-family properties in Bridgeport.
“Through this decade-long scheme, dozens of Bridgeport properties ended up in foreclosure, blighting neighborhoods and costing lenders millions,” stated U.S. Attorney Fein. “I want to commend IRS-CI, the FBI, HUD-OIG and SIGTARP for their excellent work in this ongoing investigation and for exposing this scheme.”
As part of the scheme, SHILLINGFORD and her co-conspirators purchased existing multi-family houses, and vacant parcels of land and erected new houses on them to sell. The co-conspirators recruited individuals to purchase the properties, acted as the buyers’ real estate agent and assisted the buyers in applying for residential mortgage loans to purchase the houses. SHILLINGFORD and her co-conspirators then prepared loan applications for the buyers that included fraudulent information concerning, among other things, the buyers’ employment, income, assets and liabilities, previous property ownership and intention to make the properties their primary residences. The co-conspirators also provided false and fraudulent supporting documentation, including false letters from fictitious employers, false earnings statements, and fraudulent bank records.
After the loans were approved, the illicit proceeds of the scheme were wired into the Waikele Properties bank account, transferred to SHILLINGFORD and others, and used to continue the mortgage fraud scheme.
Contrary to the representations made on the loan applications, several straw purchasers never occupied the houses as their primary residences and subsequently defaulted on the loans. As a result of the scheme, mortgage lenders have suffered more than $7 million in losses.
SHILLINGFORD is scheduled to be sentenced by United States District Judge Robert N. Chatigny on December 30, 2011, at which time SHILLINGFORD faces a maximum term of imprisonment of 40 years. The government also is seeking the forfeiture of 20 properties located in Bridgeport, and $26,372.32 that was seized from a bank account held by Waikele Properties.
This ongoing investigation is being conducted by the Internal Revenue Service – Criminal Investigation, the Federal Bureau of Investigation, the U.S. Department of Housing and Urban Development’s Office of Inspector General and the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP). This case is being prosecuted by Assistant United States Attorneys Douglas P. Morabito and David T. Huang.
In July 2009, the U.S. Attorney’s Office and the Federal Bureau of Investigation announced the formation of the Connecticut Mortgage Fraud Task Force to investigate and prosecute mortgage fraud cases and related financial crimes occurring in Connecticut. Citizens are encouraged to report any suspected mortgage fraud activity by calling 203-333-3512 and requesting the Connecticut Mortgage Fraud Task Force, or by sending an email to ctmortgagefraud@ic.fbi.gov.
The Connecticut Mortgage Fraud Task Force includes representatives from the U.S. Attorney’s Office; Federal Bureau of Investigation; Internal Revenue Service – Criminal Investigation; U.S. Postal Inspection Service; U.S. Department of Housing and Urban Development, Office of Inspector General; Federal Deposit Insurance Corporation, Office of Inspector General, Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), and State of Connecticut Department of Banking.
This case was brought in coordination with the President’s Financial Fraud Enforcement Task Force, which was established to wage an aggressive and coordinated effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
To report financial fraud crimes, and to learn more about the President’s Financial Fraud Enforcement Task Force, please visit www.stopfraud.gov
So who was selling the land for the Finch administration? Did Mario have anything to do with this?
So how many homes & lots did the Fabs & Finch Administrations foreclose on for back taxes just to give to Shillingford? Did Shillingford, Waikele kick any money over to the Finch Campaign, Fabs or the DTC? Who were the Realtor and closing attorneys for the city?
The might and power of the Federal government and their elite investigative teams creates a window into the false application for mortgages over a ten-year period causing losses to lending institutions and others. But the illegal work is estimated to have gone on for about 10 years! Incredible isn’t it? You would think somebody was minding the store, worried about paperwork, concerned about taking upon oneself risky transactions? But here you would have been wrong, because bad things happened when regulations were inadequate, ignored or broken, when crooks saw opportunities and it does take time to drill down and separate wrongdoing from plain uncaring or incompetent behavior.
So how do you feel about fiscal governance in Bridgeport? The initiatives, ideas and going concern concepts come from somewhere and presumably are shared in a “governance circle” … Mario T, Finch, Wood, Sherwood, Stafstrom and any other “usual suspects.”
What’s the problem with this brain trust in control, folks? Who needs to know? And what do they get to know and when? Great questions but when you think about Pension Plan A negotiations with risky decreased contributions between Finch and Hartford, Board of Education member ‘terminations’ discussed in Hartford in 2010 but rolling into action in Bridgeport in 2011, and local labor contract negotiations where we learn about Fire Department settlement, but information on increased liabilities for Pension Plan A caused by the Fire settlement and migration of Fire Pension B etc. to MERF has not occurred and no reasons are provided.
So please think about the seven folks serving on B & A, our Tom McCarthy-selected Council persons who has eliminated members who ask too many questions historically: Average Bridgeport citizens, some with college degrees, others high school, and none with the type of financial experience or jobs seen on similar “last check and balance” financial groups in other communities to mind the fiscal store. Sue Brannelly has initiated a concept to make a monthly operating budget review part of their regular work, an agenda standing item. Great news. Goes to show you what we have not had in the past when the B &A would suspend or cancel six regular monthly meetings per year. (These meetings received the “monthly” reports only three times in the last fiscal year, September, March and late August for the May 11 month results. So who needs to review monthly? Or so the Finch circle would lead you to believe.)
Tom Sherwood, regarding year-end closing and report, explains it takes 60 days to put the records in order after the fiscal June 30 close, and by September the auditors are present doing their review, so the Council and the public can wait for more than six months for year-end results. Tom does not claim this to be a “best practice” but rather something that works for Bridgeport. (Remember this document is only operating budget, not grants budget, not capital projects budgets, not balance sheet review, or where the cash is and needs to be as in many communities.)
When the Financial Review Board was present, they knew everything, until they had a question about something else, and they got that info promptly for their monthly meetings. What a long way this City has traveled until today, where Tom Sherwood guides the process to an ill-equipped and underinformed group of elected representatives. And current co-chair and 14-year representative is heard to say monthly reviews will be tough to expect because members are often absent? Wow!
This is our elected football team on defense … only too happy to pass what is requested by the administration, but only now getting around to having just the operating budget on a monthly agenda. And if the form of reporting changes per Sherwood thinking, will the public receive what the Council does or something different? Folks, we are in the red zone regularly, and the Mayor’s team of decision makers can score points at will. Is no one concerned? Is it illegal to remove ‘internal audit staff’ and still claim that function exists in City government? Does the City provide the same info to all parties or does Hartford get one story and the rating agencies another, etc.? And the Management Report the external auditor told me two years ago is in the City Clerk’s office is not, as of Wednesday afternoon, and has never been according to credible staff. But Tom Sherwood says it is.
I want to review several years of external audit comments from the Management Letter. I think it will tell us much about the entire fiscal story in Bridgeport as it has developed during the Finch term, and that story may be different from that which is shared by OPM with our “defense team.” Can you imagine a pro defense that is coached by the opposing offense? Incredible, isn’t it. What person or department has a current and comprehensive view of our financial status and who is attempting to use that knowledge to reduce unnecessary staffing including unfilled positions, cut down on borrowing and therefore interest expense, and build those funds that are necessary for operation as well as those required by contracts or law? Will ‘public ignorance’ be a defense when the stuff hits the fan in the storm? Who has tried to increase public communication and dialogue? Not the Mayor’s office! Not the Council. One-way communication is the rule. Listening is a difficult task it seems, and committee process leaves no time for public comment in sub-committee meetings still. What a revolting situation! Only time will tell.
BEACON2 // Oct 13, 2011 at 5:31 pm
To your posting
B2,
You nailed it. Let’s see who gets ready for the test …
I think this is the tip of the iceberg. The FBI never left BPT–the cat is playing with the mouse. I hope Rick Torres is also paying attention to this and intervenes.