Industry vet: Fraudster's sentence hurts brokers

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Nova Scotia veteran Richard LeBlanc is upset that a convicted mortgage fraudster has been handed what he terms a slap on the wrist, a lenient sentence that threatens to tar all brokers with the same brush.
“It is going to reflect badly on us, and badly on the industry. if this joker is allowed to walk away,” says LeBlanc, of Dominion Lending Centers Venture Mortgage in Yarmouth, N.S. ”He should be in jail – CAAMP should jump on top of this guy. CAAMP and CMHC should insist that the lenders go after him for restitution.”
Former real estate and mortgage broker Raymond Michael Nelson was at the nexus of one of the largest mortgage frauds in Nova Scotia's history.
Nelson faced 96 charges involving 32 counts of fraud, 32 counts of forgery and 32 counts of uttering forged documents in a scam involving 11 individuals, including a lawyer and an appraiser and more than 30 properties. The combined frauds were in excess of $6 million.
On March 4, Nelson pleaded guilty to one count of uttering forged documents, resulting in a sentence of one year probation and an $8,000 fine (plus $1,200 court costs). No jail, no restitution.
So far only one defrauded lender has taken the appraiser to court for restitution.
“It all started when the real estate registrar immediately revoked his licence, then the mortgage registrar revoked his licence,” says LeBlanc. “Then the RCMP got involved, and five years later he walks away with a slap on the wrist. He must be laughing, but this is an insult to the mortgage industry and a great miscarriage of justice!”
Nelson committed the fraud he's pleaded guilty to between 2006 and 2008 while still a broker, collecting documents from clients and submitting them to lenders in support of mortgage applications. He allegedly submitted inflated rents on documents to the lenders, thereby falsely increasing the value of the properties, and increasing his commissions from the total mortgage funds advanced.
Nelson was fined $40,000 in 2008 and promised never to reapply for a real estate broker’s licence, following his conviction for several offenses at a tribunal held by the Nova Scotia Real Estate Commission.
“There should be a jail term, he needs to be punished,” says LeBlanc. “It does not send a good message. We as brokers need to draw attention to this.”


  • Leo Escobar- Virtual Mortgage Broker on 2013-03-09 4:17:33 AM

    I agree, this guy got away too easy. It makes it look like its ok what he did and the population could lose trust in the mortgage brokers as a whole

  • Kevin on 2013-03-09 4:28:37 AM

    Same thing hapens in Alberta. they voulentary give up their licence, small fine and some go back brokering without a licence!! Many individuals are brokering in the province without being licenced with RECA. They seem to skip under the radar.

  • Ron Butler on 2013-03-09 4:35:28 AM

    Bankers have done fraud and its been well publicized, investment advisors have done so much fraud its almost a monthly occurance. Lawyers are being arrested all the time and don't get me started on Realtors.

    Let's take a deep breath and not panic. There are bad apples in every business but as a group we are angels compared with the investment advisors that see their members being carted off to court with great regularity.

  • Richard LeBlanc-DLC on 2013-03-09 7:15:40 AM

    The sentence given to Mr Nelson in this fraud case does not suit the crime. It is a mockery of the mortgage industry and a miscarriage of justice. It sends out the wrong message to other unscrupulous mortgage brokers that if you can dupe the system for over six million dollars and walk away with an $8000. fine then it's worth the risk. CAAMP should be all over this and be encouraging the lenders to launch a civil law suit to recover their losses and set an example!"

  • truthseeker on 2013-03-12 4:12:15 AM

    I notice that Mr. Richard LeBlanc appears to have forgotten to mention some of the background of his story.

    Right after he called Mr. Nelson a joker, he should have included the following--

    Mr. Nelson was my business partner (in real estate but never in the mortgage business).

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