Disbarred Lawyer Gets 57 Months in Prison for Mortgage Fraud Scheme

A disbarred Illinois lawyer has been sentenced to more than four years in federal prison for her role in a mortgage fraud scheme that bilked lenders and vulnerable homeowners out of more than $725,000, according to a press release from the U.S. Attorney’s Office.

Avalon Betts-Gaston made fraudulent real estate transactions to defraud homeowners and financial institutions, the release said. She and a co-defendant, Dimona Ross, arranged for the submission of materially false information on mortgage loan documents in four Cook County real estate transactions worth more than $725,000, according to the release.

A federal jury last year convicted Betts-Gaston, 47, of Naperville, on two counts of wire fraud. In addition to the 57-month prison term, she was ordered to pay restitution in the amount of $239,550.48.

“This case demonstrates a sophisticated scheme to take advantage of the trust that mortgage lenders placed in the loan applications they received, and the trust that the homeowners placed in her,” Assistant U.S. Attorney Stephen Chahn Lee argued in the government’s sentencing memorandum, according to the release. “The homeowners believed that she was there to help them, and instead she put their homes and equity at risk.”

Betts-Gaston graduated from law school and was admitted to the Illinois bar in 2000. Ross was a licensed real estate loan officer. Together they founded IJCN Investments, which was based in Chicago Ridge and purportedly helped distressed homeowners refinance their homes to avoid foreclosure.

IJCN was involved in various Cook County real estate transactions, with Betts-Gaston handling the legal aspects and Ross obtaining the mortgages, the release said. Evidence at trial revealed that instead of refinancing the homes, the defendants arranged for the properties to be sold to a straw buyer, according to the release.

"In doing so, the pair submitted false applications for mortgage loans, eradicated the homeowners’ legal rights in their properties, and obtained all of the homeowners’ equity," the release said.

Betts-Gaston and Ross received fees for the deals, and the straw buyers were paid thousands of dollars.

IJCN was dissolved in 2008, and Betts-Gaston was disbarred in 2012.

Ross pleaded guilty to one count of wire fraud. She is scheduled to be sentenced at 10 a.m. May 11.