Friday, April 06, 2012
Hennepin County Attorney Mike Freeman announced Thursday that the crack down on mortgage fraud has resulted in convictions of 50 people for $125 million in fraudulent loans.
“These crimes have brought damage to the neighborhoods, in excess of $125 million,” Freeman said at the news conference. “We’ve been able to obtain a large degree of justice.”
The news conference, held outside a home on Upton Avenue North in Minneapolis that went into foreclosure because of the fraud, also was a report on the end of the mortgage fraud investigations, because most of them are now outside the five-year statute of limitations.
Freeman said the fraud affected 500 residential properties. While most of them were in North Minneapolis, some of the cases dealt with properties in Ramsey, Sherburne, Carver, Wright, Anoka, Dakota and Washington Counties.
“Much of the work we are doing is over,” he said. “If new ones come in, we will prosecute them. But the newest scams are financial scams against our seniors,” and Freeman said his office is now stepping up its prosecution of crimes against the elderly.
John Foster and Melony Michaels describe their experience as victims of mortgage fraud. Hennepin County Attorney Mike Freeman and Beth Soll look on.
John Foster and his wife Melony Michaels, of Plymouth, were victims of Larry Maxwell and others who stole Foster’s identity and used it to purchase several houses with a buyer posing and Foster. By the time Foster discovered what had happened, some of the houses were in default and his credit card companies raised his interest rate to 33 percent because he was seen as a credit risk.
Foster, a driver for UPS, had to cash in his retirement account of more than $100,000 to pay off some of the debt and Michaels had to quit her job and devote her time to trying to unravel the situation and try to get local and federal agencies involved. No one would help until they were referred to the Hennepin County Attorney’s Office. Maxwell was convicted and sentenced to 198 months in prison.
“Our lives have been destroyed,” Foster said, but at least there was some justice done.
Beth Soll, of Shoreview, told about after her divorce, she had several rental properties to support herself and her three children. Hugo Barbieri befriended her and kept asking her if she wanted to sell. She declined, but over several years, he kept asking and finally invited her to go into business with him.
Soll did due diligence on him and thought it was safe. But it turns out the business was a sham, they started forging her signature, and soon her name was on the mortgage of 12 properties with straw buyers. She sought help and finally was referred to the Hennepin County Attorney’s Office.
“The prosecutors and investigators there did a great job,” Soll said. “They followed up on all the information I gave them and they eventually brought charges and convicted Barbieri of identity theft. He is now serving 56 months in prison.
“I’m still in the process of repairing the damage to my finances. My once great credit rating is in the toilet. I was going to use my sale proceeds to send my kids to college, but had to give up that idea. While I have not yet been able to get my money back, I at least have the satisfaction of knowing that justice was done and this man will not be able to prey on others.”
Update: Watch the Press Conference