Ten N.J. Residents Charged in Jersey Shore Condo Fraud Scheme

The FBI and IRS-Criminal Investigation unit arrested nine out of 10 New Jersey residents who are being charged in an alleged $40 million mortgage fraud, which, according to a press release from the office of U.S. Attorney Paul J. Fishman, used "straw buyers" and fake documents to make illegal profits from condos at the Jersey Shore, as well as at resort destinations in Georgia and South Carolina.

Those being charged, according to the press release, are:

• Joseph Witkowski, 66, of Flemington, N.J.
• Robert Serao, 46, of Bayville, N.J.
• Catherine Pearson, 53, of West Orange, N.J.
• Isatu Tejan-Sie, 54, of Long Branch, N.J.
• Crystal Brame, 42, of Irvington, N.J.
• Karen Yokely, 59, of Plainfield, N.J.
• George Lachenmayr Jr., 79, of Irvington, N.J.
• Aku I. Muhammad, 42, of Newark, N.J.
• Mark Kreischer, 33, of Elmwood Park, N.J.
• Marc Jacobs, 47, of Hackettstown, N.J.

All ten are being charged with conspiracy to commit wire fraud and Witkowski is also being charged with conspiracy to commit money laundering, according to the release.

The release states that Witkowski, Pearson, Brame and Tejan-Sie located oceanfront condominiums which were overbuilt by financially distressed developers, then recruited "straw buyers," which allegedly included Muhammad, Kreischer, Jacobs and Lachenmayr, who had good credit scores but not the financial resources to qualify for mortgage loans.

Pearson allegedly created false documents, such as income tax returns, fake W-2 forms, and investment statements in an attempt to make the buyers more creditworthy than they were, the release said.

These false documents were then allegedly submitted to mortgage brokers, some of which who, according to the release, knew the documents were false. Once the loans were approved and the lenders sent loan proceeds in connection with real estate closings, Witkowski and his alleged conspirators took portions of the proceeds, wiring funds and depositing checks into various accounts.

The wire fraud conspiracy charge carries a maximum penalty of a $1 million fine and 30 years in prison, while the money laundering conspiracy charge carries a maximum penalty of a $250,000 fine and 10 years in prison.

Among the agents and departments thanked for their efforts by U.S. Attorney Fishman were special agents from the FBI's Atlantic City Resident Agency.