Unlicensed mortgage broker defrauded wholesale lenders

Unlicensed mortgage broker defrauded wholesale lenders
A 50-year-old former unlicensed mortgage broker from Long Island, New York, pleaded guilty Wednesday to defrauding clients and wholesale lenders out of $4.7 million in mortgage refinancing proceeds that were supposed to pay off existing client mortgages.

Brent Kaufman, of Commack, New York, faces up to 30 years in prison, as well as forfeiture and a fine of up to $1 million.

According to the U.S. Attorney’s Office, Kaufman worked as an unlicensed mortgage broker and often worked with clients in Queens and Long Island to refinance their mortgages. Between 2016 and 2019, Kaufman and others defrauded Homepoint, loanDepot and United Wholesale Mortgage by providing incorrect wire routing information to the lenders for the existing mortgages, the U.S. Attorney’s Office said Wednesday.

“Instead of wiring the funds to the correct financial institution, the funds were instead transferred to bank accounts controlled by Kaufman,” the federal government said. “As a result, the existing mortgages were not paid off—leaving the clients with two mortgages on their homes—and Kaufman stole the funds for his own personal use.”

All told, Kaufman stole more than $4.7 million, some of which he used to make mortgage payments on the existing mortgages to avoid being caught. When he stopped making payments, several of the homes were foreclosed on, the U.S. Attorney’s Office said.

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During the period of the charged conduct, Kaufman stole more than over $4.7 million, some of which he used to make mortgage payments on the existing mortgages or to eventually pay off those mortgages to avoid detection of his scheme. When Kaufman stopped paying the existing mortgages, several of his clients’ homes were foreclosed on. Victims of the scheme ultimately suffered a loss of approximately $2.5 million.

“Not only did Kaufman steal his victims’ money, but he also violated their trust, leaving them financially vulnerable and at risk of significant financial complications,” stated FBI Assistant Director-in-Charge Michael Driscoll.  “Collectively, his victims suffered millions of dollars in losses. Today’s guilty plea reminds us of the threat posed by those who prioritize their own financial interests above all else.”

Prior to working at mortgage brokerage Bliss Home Funding Corp., Kaufman, a former lawyer, pleaded guilty to filing false claims in bankruptcy hearings and was disbarred.
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