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E-mail This StoryA McKinney couple will do federal jail time for their part of a housing scam that took more than $4 million from several national mortgage lenders.
Michael Breon, 39, and his wife Sindhu Sukumaran, 36, each received a federal jail sentence on Monday in the Western District of Texas federal court on charges including conspiracy, committed false statements related to a loan and conspiracy to engage in illegal monetary transactions, according to federal court documents.
Breon was found guilty Monday on one count of each charge and sentenced to three concurrent 48-month sentences and a $63,000 fine. The conspiracy and false statement charges also carry a three- to five-year supervisory period upon his release from prison, according to Western District of Texas’ court clerk officials.
Sukumaran received an 18-month federal prison sentence after a jury found her guilty on one count of committing a false statement related to a loan. She did not receive a fine as part of her sentence, according to clerk officials.
The scheme involved several defendants, led by 47-year-old Cornelius Robinson of Austin, and two fake investment clubs called “Waterfall Real Estate Investments” and “Billionaires Boys Club Investments” nicknamed by its acronym, “BBC.” Both were incorporated by the state of Texas between 1998 and 2002. Robinson was listed as the “alter ego” of the BBC, according to court records.
These groups would obtain funding from mortgage companies by submitting fraudulent and misleading documents seeking the intent to obtain property. Instead of paying the money back, the defendants would pocket the money and the property would go into default.
“It was part of the conspiracy and fraudulent scheme that the Defendants, aided and abetted by each other, would purchase real properties by making materially false and fraudulent pretenses, representations and promises in documents, submitted by them, or on their behalf, to the mortgage lenders funding the real estate purchases,” the indictment said. “The purchases of such property are commonly referred to as ‘straw buyers’ in that they did not intend to have an actual interest in the property.”
The defendants, including Breon, would submit several false documents to the companies to obtain the funding for the “straw buyers” containing fake phone numbers and addresses, job verifications, deposit verifications and U.S. Housing and Urban Development (HUD) settlement statements.
Sukumaran sold a piece of property in Austin to Waterfall on Jan. 6, 2003 at a $2.5 million price tag with funding from a Fort Worth based mortgage loan company. Sukumaran signed a deed conveying the property back to Waterfall but did not record it with the Travis County Clerk’s office until March 30, 2004. The following day, she converted half of her interest in the property to Breon who also signed a deed giving the property back to Waterfall, according to court documents.
Robinson found a third party to “flip the home” away from Waterfall, Sukumaran and Breon and found another buyer to purchase the same piece of property at $3.6 million with funds provided by another loan from a bank in Stockton, Calif. The defendants moved the funds around through wire transfers.
Contact Danny Gallagher at dgallagher@acnpapers.com. To post comments online, access this story on the web at www.scntx.com.
