West Orange Man Tried To Fraudulently Pay Mortgage: Prosecutor

WEST ORANGE, NJ — Federal prosecutors have charged five people – including residents of West Orange and Maplewood – in connection with a series of schemes to use “phony money orders,” cashier’s checks and other fake documents in an attempt to discharge mortgages, student loans and other financial obligations.

Authorities arrested five people in connection with the alleged schemes on Tuesday, according to the U.S. Attorney’s Office (NJ):

• Melissa Reynolds, 42, of Elizabeth, New Jersey, was charged with three counts of conspiracy to commit bank and mail fraud, two counts of bank fraud, one count of mail fraud, one count of conspiracy to commit mail fraud, and one count of making false statements to the United States.
• Germaine King, 40, of Elizabeth, was charged with one count of conspiracy to commit mail fraud, one count of mail fraud and one count of making false statements to the United States.
• Henry Grady James IV, 43, of Hillside, and Arthur N. Martin III of West Orange, were both charged with one count of conspiracy to commit bank and mail fraud.
• Daniel K. Dxrams, 39, of Maplewood, was charged with one count of conspiracy to commit mail fraud.

MORTGAGE PAYMENTS

According to prosecutors, in March 2013, Reynolds obtained a $417,276 mortgage from an unnamed business referred to in the complaint as “Financial Institution One” for the purchase of her Elizabeth residence. In May 2014, Reynolds allegedly mailed a fraudulent money order in the amount of $432,000 to “Financial Institution One” as a payoff on the mortgage. The money order falsely claimed to have been issued or processed by the IRS.

Financial Institution One’s mortgage business “erroneously accepted” the fraudulent payment and credited it as a payoff for Reynolds’ mortgage. Financial Institution One also mailed Reynolds an overpayment refund of $9,789, prosecutors stated.

“When Financial Institution One’s mortgage business filed a suit seeking to reinstate the fraudulently discharged mortgage, Reynolds and King continued to allege in court that the mortgage had been paid and even submitted a phony receipt for the bogus money order,” prosecutors said.

Reynolds and others then unsuccessfully tried to use the same scheme to seek the discharge of other mortgages, including Reynolds’ second residence in Newark, James’ residence in Hillside, Martin’s residence in West Orange, and the residence of an individual in Bowie, Maryland, prosecutors alleged.

STUDENT LOANS

In addition, Reynolds allegedly also sought to fraudulently discharge over $52,000 in student loans with fraudulent money orders and cashier’s checks, prosecutors said.

“For example, on March 20, 2017, Reynolds sent a fraudulent cashier’s check in the amount $67,000 to the Department of Education’s processing company,” prosecutors stated.

The payment was rejected, prosecutors said.

LUXURY CARS

Reynolds, King, and Dxrams also allegedly conspired to fraudulently obtain luxury cars in a similar fashion, prosecutors said.

“For instance, Reynolds sent a bogus $101,000 cashier’s check to a finance company that enabled Dxrams to obtain a 2012 Bentley,” prosecutors alleged. “Dxrams sold the car to a third party for approximately $85,000 and then issued a bank check to King for approximately $25,000. The defendants also used this scheme in an effort to fraudulently obtain two Mercedes-Benz cars.”

According to prosecutors:

• The bank fraud and bank fraud conspiracy charges are punishable by a maximum potential penalty of 30 years in prison and a $1 million fine, or twice the gross gain or loss from the offense.
• The mail fraud and mail fraud conspiracy charges are punishable by a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.
• The false statement charge is punishable by a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.

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