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Straw Buyers Get Burned by Federal Charges in Mortgage Scams

Four people who ran a mortgage scam in Colonie, New York, have secured plea deals with prosecutors. The owner and three employees of Rivertown Investments face possible prison terms when sentenced.

The Albany Times Union reports that Jonathan Goldman, of Newburgh, pleaded guilty to first degree scheming to defraud. He served as Rivertown’s vice president and its chief marketing officer under his brother, Geoffrey Goldman, 34, company founder.

Geoffrey Goldman started Rivertown in 2002, looking for financially distressed homeowners. The company offered to buy the homes and then lease them back to the former owners.

Prosecutors say the promises were false ones. The company allegedly used straw buyers to purchase the properties; the titles were then quickly transferred to a Rivertown holding company. The company is said to have used falsified financial information about the straw buyers in order to purchase the homes.

What is a Straw Buyer?

The organizer of the scam typically recruits a straw buyer, who lends their name to the scheme, usually in return for a small fee.

Straw buyers can face state or federal fraud charges for participating in the fraud, meaning they could face harsh sentences including prison time and restitution for small roles in often large and complicated scams.

In some cases, straw buyers can be unaware of the criminal intent of the organizers of the fraud.

However, even an unwitting accomplice can be caught up in federal and state mortgage fraud investigations and be confronted with very real charges involving various white collar crimes such as mail fraud, making false statements on federal financial documents and more.

If you face fraud charges, contact a New York criminal defense attorney experienced in defending clients accused of mortgage fraud and similar charges.

Related Story:

Four plea deals in Colonie mortgage fraud case; local attorney now sole defendant, Times Union