$12-million mortgage fraud uncovered in Calgary

$12-million mortgage fraud uncovered in Calgary

A $12-million mortgage fraud was discovered by police in Calgary that involved 22 homes and eight banks.

A team of men allegedly convinced naive "straw buyers" to use their names to obtain mortgages as an investment. The buyers were told after six months, the mortgages would be taken over by the men, and were supposedly given $3,000 to $5,000 in return.

"Most of (the buyers) were fairly young, as far as residential buyers, with their ages ranging from 20 to 28," said Kevin Forsen, inspector of the Alberta Law Enforcement Response Teams, to the Canadian Press.

The men supposedly gained a large amount of money from the mortgages and walked away afterward, leaving the buyers' responsible.

Ali El-Sayed, 31, is charged with extortion, and 23 counts of fraud over $5,000, and affect his company, Ramses Holdings Inc.

Christos Fotopoulous, 28, surrendered to police Wednesday and was charged with three counts of fraud over $5,000.

An arrest warrant has been issued for Russell Kilba, 34, and is wanted on 10 counts of fraud over $5,000.

The banks involved include Scotiabank, TD Canada Trust, ATB Financial, First National Financial, CIBC, Merix Financial, Royal Bank and MCAP Financial.

  • Dave 2010-08-07 2:40:34 AM
    Yet another case of fraud. I wonder when and if lenders might decide that working with mortgage brokers isn't worth their trouble.

    How are people like these let into the industry?
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  • mortgage broker 2010-08-07 4:05:42 AM
    To Mortgage Person... if you think Mortgage Brokers are all crooked, then you are mistaken.. if you think the Mortgage Specialists that work for the Big Banks are all legit and honest, then you are naive... There have been several infamous cases where Bank employees where involved with mortgage fraud... the Specialists are not held accountable and have no reporting or qualifying process before being released and let out to the public to sell mortgages.... Mortgage Brokers are accountable in most provinces and are held to a very high standard.. I think the standard can still be improved.. but the Banks should also be held accountable....
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  • Sudip Adhikari 2010-08-10 10:20:11 AM
    Fraud is dark side of the financial industry. That does not necessarily taint the whole industry. I guess I can say that exceptions prove the law.
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