A former local attorney pleaded guilty in connection to a complex mortgage scheme, where he used fraudulent documents to defraud homeowners and mortgage lenders in real estate transactions involving 26 distressed properties in the Greater Boston area.
Bruce Namenson, 47, of Walpole, will serve one year in prison for misrepresenting closing statements in conspiracy with Boston Equity Investments.
After a lengthy investigation, authorities found Joshua Brown, 29, of Brockton, operated Boston Equity Investments (BEI) in Boston, while Brian Frank, 32, of New Hartford, N.Y., operated Freedom Equity Investments (FEI) in Hillsborough, N.J.
Authorities allege that FEI recruited people interested in investing in multifamily homes through BEI. These investors unknowingly assisted BEI commit this fraud. In addition, John Sweetland, 28, of Yorba Linda, Calif., operated Boston Investment Marketing (BIM), another BEI recruitment wing in Canton, which would identify potential investors.
In addition to Brown, Frank and Sweetland, mortgage brokers Linda Defeo, 28, of Springfield and Brian Arrington, 39, of Boston, have been charged. Authorities allege that Brown, Frank and Sweetland fraudulently obtained approximately $12.5 million in loans from more than a dozen financial lending institutions to purchase multifamily homes, from which they made approximately $2 million in proceeds.
Authorities allege that Brown, Frank and Sweetland offered owners of multifamily properties who had properties for sale for long periods of time to give BEI an "option" to sell these properties at prices below the current list price. BEI simultaneously recruited homebuyers to buy the same properties as "investments," promising them that in return for purchasing properties through BEI, BEI would renovate, rent and resell the properties. BEI acquired inflated property appraisals for the sellers’ properties.
Investigators also discovered that Brown, Frank and Sweetland conspired with Defeo and Arrington to submit loan applications to financial lending institutions with false information in order to secure 100 percent financing for the homebuyers’ purchases.
Namenson, in conspiracy with BEI, misrepresented on closing settlement statements that the homebuyers brought cash to the closings, when he and BEI knew that the borrowers did not do so. Namenson, in conspiracy with BEI, sent a business associate to several states to obtain homebuyers’ signatures on documents critical to the real estate closings.
Later, Namenson notarized the documents claiming that the homebuyers had signed the documents in his presence in Massachusetts. In addition, the lenders required that Namenson purchase title insurance for the closings. Namenson represented to the lenders that he was using the borrowers’ money to do so. Namenson did not purchase title insurance and retained the borrowers’ premiums for himself instead.
Namenson pleaded guilty Wednesday to 18 counts of larceny over $250, nine counts of making or publishing false or exaggerated statements and four counts of writing false reports. Superior Court Judge Carol Ball sentenced Namenson to serve two years prison, one year to serve, with the balance suspended for three years.
The remaining defendants in the case are scheduled to appear in court Monday for a pre-trial hearing.
