Watchung Real Estate Investor Charged In Mortgage Fraud Scheme

WATCHUNG, NJ — A Watchung real estate investor was among three to be charged in connection with their alleged roles in a mortgage fraud scheme, U.S. Attorney Craig Carpenito announced.

Victor Santos, aka “Vitor Santos,” 58, of Watchung; Arsenio Santos, aka “Gaspar Santos,” 51, of Warren; and Fausto Simoes, 65, of Millington were charged on Sept. 24, in a 19-count indictment. They were each charged with one count of conspiring to commit bank fraud.

Victor Santos was charged with nine counts of bank fraud and nine counts of making false statements in an application for credit.

Arsenio Santos was charged with four counts of bank fraud and four counts of making false statements in an application for credit.

Simoes was charged with seven counts of bank fraud and seven counts of making false statements in an application for credit.

Victor Santos, a real estate investor; Arsenio Santos, a builder; and Simoes, a real estate settlement attorney, and others allegedly conspired to fraudulently get mortgage loans with a total value of more than $4 million from September 2007 through November 2008, according to documents filed in this case.

All three allegedly recruited others to buy properties in Newark using their identity and credit history, in exchange for a fee of at least $5,000, provide them their down payment and cash required for closing, secure tenants to lease the purchased property, and make the mortgage payments on each of the fraudulently obtained mortgages, according to the report.

These secret agreements were not disclosed to the bank. Shortly after the properties were acquired the mortgages went into default, according to the report.

The other conspirators would then buy the properties for far more than the sellers had agreed to sell, and the conspirators would then divert the extra loan proceeds for their own benefit and to further the conspiracy, according to the report.

The conspiracy to commit bank fraud count, the bank fraud counts, and the false statement counts, each carry a maximum potential penalty of 30 years in prison, a fine of $1 million or twice the gross gain to the the three men or twice the gross loss to others whichever is greater.

(Image via Shutterstock)

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