Homeownership isn’t just the American dream, it’s also the illegal-immigrant dream.
For them, there’s Team Mendez, a Lakewood-based real-estate firm that helped its undocumented clients file fraudulent applications for government-insured mortgages. No papers. No problem.
Team Mendez helped clients falsify tax forms, pay stubs, ID cards, Social Security numbers, green cards and letters of credit, according to a plea agreement filed in U.S. District Court in Denver.
On Thursday, Team Mendez honcho William E. Mendez, 41, of Denver was sentenced to 49 months in federal prison for helping his clients prepare more than 100 fraudulent mortgage applications between January 2000 and November 2002.
With an estimated 12 million illegal immigrants in the United States, mortgage fraud has been a growth industry.
The U.S. Justice Department is cracking down, but slowly. Since 2003, the U.S. attorney’s office in Denver has brought 12 indictments, charging 84 defendants with mortgage fraud – and most of these cases involve illegal immigrants, said U.S. attorney’s spokesman Jeff Dorschner.
In a recent case in Las Vegas, the former owner of Nevada First Residential Mortgage, Mark Young, 41, was sentenced in March to six years in prison. Most of his clients were illegal immigrants as well, prosecutors said.
These cases typically come to prosecutors’ attention when homebuyers default on their government-insured loans, sticking the U.S. Department of Housing and Urban Development – and ultimately taxpayers – with the liabilities. The court has ordered Mendez to pay more than $1.2 million in restitution to HUD.
Mendez, a licensed real-estate agent, opened his agency in 1999. He employed at least four other real-estate agents, two employees and at least one outside contractor, according to his plea agreement.
“Mendez developed office practices designed to allow him and the other real-estate agents and employees … to assist clients whom they knew to be illegal aliens or otherwise unqualified to receive home mortgages,” the plea agreement said.
Mendez received all commissions from his team’s real-estate transactions. He would then distribute half to the agents who handled them, a practice that exposed him to wire-fraud charges.
A cast of characters from Team Mendez and two clients also were indicted:
Rogaciano Caldera, a broker, was sentenced to serve 18 months in federal prison and ordered to pay $80,792 in restitution to HUD. Broker Patricia Soehnge was sentenced to serve 18 months and ordered to pay $41,734, along with defendant Nicolas Lopez. Lopez, who helped prepare false documents, was sentenced to five years’ probation. Additionally, Claudia Mendez, Mendez’s sister, has pleaded guilty and is scheduled to be sentenced June 21. Benedicta Gomez, who prepared false documents, pleaded guilty and awaits sentencing. Homebuyer Leonor Martinez was sentenced to time served and ordered to pay $35,620 in restitution. Homebuyer Maria Lidia Baeza was sentenced to time served.
Assistant U.S. Attorney Matthew Kirsch prosecuted the case.
Team Mendez shows just how hospitable America has been to illegal immigrants. The borders are open. The job market is open. The housing market is open. And the mortgage industry is open too.
Brokers just want commissions. They generally don’t care who is borrowing or whether the loans are repaid because the debt is sold to large institutions, which, in turn, make a game of trading them.
The result is now a skyrocketing foreclosure rate. Colorado reportedly led the nation with the highest foreclosure rate in April and May. Mortgage fraud in a state that has not licensed mortgage brokers is one reason why. Last Friday, though, Gov. Bill Owens signed a bill requiring mortgage brokers to face criminal-background checks and register with the state, a measure that might keep some of the riffraff out of the business.
Some brokers will lend people money whether they can afford a home or not. There are interest-only loans, adjustable-rate mortgages, revolving equity lines for more than a home’s value and, apparently, no-green-card notes too.
Al Lewis’ column appears Sundays, Tuesdays and Fridays. Respond to him at denverpostbloghouse.com/lewis, 303-820-1967 or alewis@denverpost.com.
