Mortgage Broker Douglas Skibicki, Pleads Guilty to Mail Fraud in Scheme to Defraud Lenders, Family, and Others of Over $1.4 Million

Source- http://baltimore.fbi.gov/dojpressrel/pressrel11/ba010611.htm

BALTIMORE—Douglas Skibicki, age 41, of Bethesda, Maryland, pled guilty today to two counts of mail fraud in connection with a mortgage fraud scheme in which he defrauded lenders, family and others.

The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Chief William J. McMahon of the Howard County Police Department; Special Agent in Charge Richard A. McFeely; Special Agent in Charge Barbara Golden of the United States Secret Service - Baltimore Field Office; and Special Agent in Charge Ken Taylor, Jr. of the Housing and Urban Development Office of Inspector General - Office of Investigations.

According to Skibicki’s plea agreement, he was a mortgage originator and/or broker for a company which operated in Laurel, Maryland. Skibicki admitted that from April 2006 through August 2009, with the assistance of an appraiser and others, he participated in a scheme to defraud lenders, family members and others through a series of real estate transactions.

For example, in May 2007, G.C., who owned a construction company, was facing financial difficulties. G.C. contacted Douglas Skibicki to discuss whether he could help him. Skibicki had previously assisted G.C. in refinancing G.C.’s residence. Skibicki agreed to purchase a 50 percent interest in property G.C. owned at 7609 Bay Street in Pasadena, for $121,000, but told G.C. that Skibicki’s 50 percent interest in 7609 Bay Street would be put in the name of Family Member 3.

In May 2007, G.C. owned 7609 Bay Street free and clear, but there was only a garage with an attached room, as well as an unusable outhouse, built on 7609 Bay Street. There was no running water and no operable bathroom on the property.

On May 9, 2007, the appraiser working with Skibicki completed a fraudulent appraisal of 7609 Bay Street, including that there was a two-bedroom, one-bathroom existing home on the property with a “modern” kitchen and an enclosed porch and pier. The appraiser also included photographs of the front and rear of the home supposedly located at 7609 Bay Street. Those photographs were of a home that was never located at 7609 Bay Street.

In May 2007, Skibicki submitted a fraudulent loan application to National City Bank for a mortgage on 7609 Bay Street in the name of Family Member 3, which contained false statements as to Family Member 3's income and current residence. Family Member 3 did not sign the loan application and neither Family Member 3 nor G.C. signed the settlement documents that were provided to the mortgage company, showing that a settlement for the Bay Street property occurred on May 15, 2007. Based on the false information submitted by Skibicki, National City provided a mortgage on 7609 Bay Street in the amount of $260,971 in the name of Family Member 3. Skibicki received $249,997.18 in the name of Family Member 3 after taxes and closing costs were deducted. Skibicki told the title company handling the settlement to wire $121,000 to a bank account held in the name of G.C.’s construction company, to pay for the 50 percent interest in 7609 Bay Street that Skibicki had purchased in the name of Family Member 3. Skibicki subsequently allowed the mortgage on 7609 Bay Street to go into default, leading to foreclosure proceedings.

In addition, according to the plea agreement, Skibicki and Family Member 1 owned property at 5870 Deer Ridge Lane in Elkridge. On June 2, 2006, Skibicki submitted a loan application for $350,000 to refinance 5870 Deer Ridge Lane. To facilitate the loan application, the appraiser working with Skibicki prepared a fraudulent appraisal indicating that there was a 2,040 square foot home on the property and included a description of the home and photographs purporting to be of the front and back of the home. In fact, there was no home on the property, which was a vacant lot.

In August 2007, with 5870 Deer Ridge Lane still a vacant lot, Skibicki decided to refinance that property again, this time in his name only. On August 18, 2007, the appraiser working with Skibicki completed another fraudulent appraisal of 5870 Deer Ridge Lane stating that there was a 3,297 square foot, five bedroom home on the property that had, among other things, a stone patio, an enclosed and covered porch, and a balcony. Again, the appraiser included photographs purportedly of the front and rear of the home located at 5870 Deer Ridge Lane, but these were photos of a home that was never located there. In October 2007, Skibicki submitted a loan application to Washington Mutual Bank, FA, seeking to refinance 5870 Deer Ridge Lane for $517,500. The loan application indicated that title to the property would be held just by Skibicki, even though Family Member 1 had not given permission to take his name off the title to the property. The loan application also falsely stated that the purpose of the refinancing was a cash-out home improvement and contained false statements as to Skibicki’s employment and income, and that he planned to use 5870 Deer Ridge Lane as his primary residence. Skibicki submitted fraudulent documents in support of the loan application, including fraudulent W-2s for tax years 2005 and 2006. Based on the materially false information that Skibicki provided, on October 23, 2007, Washington Mutual provided a loan in the amount of $517,500. Skibicki allowed the mortgage on 5870 Deer Ridge Lane to go into default, leading to foreclosure proceedings.

Skibicki admitted that he made and caused to be made misrepresentations to other lenders in order to obtain mortgages on additional properties.

As part of his plea agreement, Skibicki has agreed to forfeit all money, property and assets, acquired as a result of, or used to facilitate the fraud scheme, and has agreed to the entry of a $1.4 million forfeiture money judgment.

Skibicki faces a maximum sentence of 20 years in prison and a fine of $250,000 or twice the gross loss or gain of the offense, if greater than $250,000, on each count of mail fraud. U.S. District Judge Catherine C. Blake has scheduled sentencing for April 22, 2011 at 9:15 a.m.

U.S. Attorney Rod J. Rosenstein recognized Howard County State’s Attorney Dario Broccolino and Chief J. Thomas Manger of the Montgomery County Police Department, and their offices, for their assistance in this investigation and prosecution.

In a related action, Mark Kaufman, Commissioner of the Maryland Department of Labor, Licensing and Regulation’s Division of Financial Regulation previously issued a Summary Order to Cease and Desist against Skibicki, prohibiting him from engaging in any further credit services business activities and/or foreclosure consultant activities with Maryland residents.

The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention, and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available at http://www.usdoj.gov/usao/md/Mortgage-Fraud/index.html.

This law enforcement action is part of President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.