Posted On: March 30, 2009

Miami Mortgage Fraud Criminal Defense Attorney on Straw Buyer Mortgage Fraud

Mortgage fraud is on the rise in the United States, especially in South Florida. State Attorney General Bill McCollum has even gone so far as to call the sharp rise in mortgage fraud a state of emergency. Against that backdrop, I was not surprised to see an item in today’s South Florida Business Journal reporting that 11 Miamians have been indicted for an alleged mortgage fraud scheme worth as much as $4.7 million.

The defendants, one of whom remains at large, are accused of running an elaborate scheme. Alleged ringleaders Juan Garcia and Yenisley Acosta are accused of recruiting the others to buy homes using false financial information and claiming the homes were for residential use. These buyers are called “straw buyers.” Once the home sales closed, the straw buyers would immediately sell the properties to other straw buyers at a higher cost, for a total of 13 transactions involving six properties over four years. Sale proceeds would go to the alleged ringleaders; none of the buyers made mortgage payments or even paid closing costs.

Of course, five of the six properties went into foreclosure right away. According to a press release from the U.S. Attorney’s office for the Southern District of Florida, several of the fraudulent loans in the scheme were Federal Housing Administration loans, which means they were guaranteed by the federal government. When the homes went into foreclosure, the federal Department of Housing and Urban Development had to pay back the loans, for a total loss to the government of $1.6 million. The newspaper gave the total value of the scheme as $4.7 million.

This is an elaborate example of the “straw buyer” or “for-profit” type of mortgage fraud, in which one person purchases the property on behalf of another person who would normally be ineligible. The straw buyer uses or falsifies good credit and a strong income in order to get the loan, but the real purchaser pays all of the costs of the transaction. In exchange for his or her services, the straw buyer (and anyone else involved in the scheme, such as an appraiser) gets part of the proceeds from the loan. The real purchaser pockets the remainder of the loan and walks away from the home without making any payments, sending it into default and foreclosure right away. This is one of the most common mortgage fraud schemes I’ve seen as a Miami mortgage fraud criminal defense attorney.

In this case, the alleged perpetrators actually sold the properties to new straw buyers, at inflated prices and using even larger loans, allowing them to profit more than once from the same property. Naturally, this defrauds the bank, which now has no way to collect on its investment. Indirectly, it also affects all of the honest homeowners in the area as well, because foreclosures drive down home prices and give banks a reason to tighten their credit standards even further.

As a South Florida mortgage fraud criminal defense lawyer, I expect to see more stories like this in the near future. The Cape Coral-Fort Myers area has the second most foreclosures of any U.S. city, according to recent statistics, and the rest of South Florida is affected as well. In many areas, we are also seeing an uptick in fraudulent schemes exploiting homeowners desperate to avoid foreclosure. Because this issue is so relevant, I intend to address different aspects of it from a Miami mortgage fraud criminal defense attorney’s perspective in the upcoming weeks’ blog posts.

Posted On: March 23, 2009

Are Red Light Camera Tickets Always Legitimate? A Fort Lauderdale Traffic Offenses Criminal Defense Lawyer Asks

More and more cities in South Florida and Central Florida are adding red-light cameras to their arsenal of tools to catch traffic offenders. Cities including Orlando and Apopka already have the cameras, the Orlando Sentinel said March 15, and many other municipalities are considering them, including Delray Beach, Winter Park, Tallahassee, Clermont and Kissimmee, as well as Orange County. In fact, state legislators are considering a law that would standardize how red light cameras are used. Generally, cameras are set to take a photo whenever the associated traffic light turns red, and drivers caught in the intersection are cited $75 to $500 by matching the license plate number in the picture to DMV records.

The cameras are praised by municipal officials as a cost-effective way to catch more red-light runners and reduce the number of serious accidents at intersections. As Winter Garden police chief George Brennan told the Sentinel, law enforcement believes that “cameras don’t lie.” But as a Miami criminal defense lawyer, I know it’s not so simple. For one thing, cameras do lie, in a way -- by omitting details in the scene that would change many police officers’ minds about whether the driver deserves a ticket. People who lent their cars to friends, people who made legal right turns on red and people who were trying to avoid an accident have all been cited -- and had their appeals denied.

And those objections don’t even touch the issue of possible flaws in the technology, including problems with how human beings administer it. As a Fort Lauderdale cyber crimes criminal defense attorney, I know very well that innocent people can end up criminally charged because of problems with technology, or how law enforcement uses technology. As this TV news report shows, one Albuquerque man got a ticket for turning right on a green arrow -- which didn’t show up on the video the city took, thanks to the camera’s low frame rate and low resolution. He successfully fought his ticket.

Even more importantly, there’s evidence that red light cameras actually make Florida roads less safe. In 2008, the University of South Florida brought out a study of the cameras showing that they actually increase rear-end accidents by giving drivers a reason to stop short when they reach an intersection with a camera. By contrast, accidents involving red-light runners were decreasing before the cameras became popular. Studies showing the cameras reduce accidents are generally flawed, the university’s press release said -- and funded by the auto insurance industry, which stands to profit from the cameras because more citations and accidents increase insurance premiums.

If red light cameras aren’t doing much for safety, why are Florida municipalities still considering them? One answer is that they consistently drive up revenues for the city or county that owns them. Police officers can’t be posted at every intersection -- but cameras can be. Even in a small city, this can add up to hundreds of extra dollars in fines per day. And it’s not just disgruntled drivers who see the financial motive -- a retired Florida Highway Patrol trooper told the Sentinel that cameras are “simply a revenue-generating device cloaked under the guise of public safety.”

More and more, drivers are fighting back, in part by arguing that photograph-only evidence denies them the Constitutional right to confront their accusers. I am proud to say that I am the South Florida criminal defense attorney representing one of these drivers. People who run red lights should absolutely be held responsible, but I believe red light cameras, with all their flaws, are not the right solution.

Posted On: March 18, 2009

Miami Criminal Defense Attorney on Technology in the Court Room

The New York Times reported today that there have been an influx of mistrials and misguided verdicts relating to juror's disregard for the law and the American system of justice as jurors are turning to the WWW for information. As a Miami Cyber Crime Defense Lawyer, I am not really sure how I feel about this. Our society is now controlled by technology, and dependent on it for our everyday lives. Is it fair to now ask people to go backwards as technology continues to move us forwards?

As a Fort Lauderdale Criminal Defense Attorney, I understand the ramifications of individuals tainting their perspective on a case with outside information. However, the real question at this point is how do we as a judiciary going to deal with it? This problem is not going to go away, and both sides always want a fair trial, but with technology in our face 24/7, is every jury from here on out going to require sequestration?

Looking at this matter on anther level, a recent NBA player was admonished for Twittering during the halftime of a recent game.

This article from the New York Times is simply the beginning of this debate. Stay tuned...

Posted On: March 16, 2009

South Florida DUI Criminal Defense Attorney on Donté Stallworth's Fatal Car Accident

One big piece of news for football fans today is Saturday’s fatal car accident involving Cleveland Browns wide receiver Donté Stallworth. According to the Miami Herald, Stallworth hit and killed a pedestrian on MacArthur Causeway between Miami and Miami Beach at around 7 a.m. March 14. The Herald said Stallworth is cooperating with authorities. As is routine after a fatal traffic accident, law enforcement drew Stallworth’s blood to test for drug or alcohol intoxication; results are expected at the end of the week.

This video, posted online by the Herald, shows officers performing field sobriety tests on Stallworth and trying to resuscitate the victim, 59-year-old Mario Reyes. As the newspaper warned its readers, the video is "graphic" and not appropriate for everyone because it shows Reyes at the scene.

Of course, this case is attracting a lot of attention because the driver is a celebrity -- but as a Miami vehicular homicide criminal defense lawyer, I don’t see much that’s out of the ordinary right now. Around the Internet, rumor has it that prosecutors are poised to charge Stallworth with DUI manslaughter once the test results come back. This has generated a lot of anger about irresponsible football players and indulgent authorities who go easy on celebrities who drive drunk.

However, as far as I can see, no established news organization has reported that Stallworth was actually intoxicated, or appeared intoxicated at the scene. In the Miami Herald’s video, viewers can clearly see officers administering a horizontal gaze nystagmus test, in which Stallworth would have been asked to follow the officer’s penlight with his eyes. Stallworth appears calm and cooperative. None of these things are proof that he was sober, of course, but they don’t show that he was driving while intoxicated either -- and even football players are innocent until proven guilty in the United States. As a Fort Lauderdale DUI criminal defense attorney, I prefer to reserve my judgment until law enforcement releases the toxicology reports.

I know how passionate fans can be when they see players accused of -- or seeming to get away with -- serious crimes. And if there’s a crime here, it is serious. Both DUI manslaughter and vehicular homicide (which doesn’t require any alcohol involvement) are second-degree felonies in Florida carrying up to 15 years in prison and fines up to $10,000.

If Stallworth doesn’t already have a South Florida vehicular manslaughter criminal defense lawyer, he should get one as soon as possible. Manslaughter charges are serious under any circumstances, but the situation can be seriously complicated by early conviction in the “court of public opinion.” Stallworth, like everyone accused of a crime, deserves a fair trial in a court of law.

Posted On: March 9, 2009

South Florida Cyber Crimes Criminal Defense Attorney on ‘Sexting’ Prosecution for School Administrator

As a Miami cyber crimes criminal defense lawyer, I have followed the ongoing media coverage of “sexting” with great interest. Sexting is the name the media uses for the practice among teenagers of taking naked or near-naked photos using a cell phone or other device, then text messaging or emailing them to boyfriends and girlfriends. When adult authority figures find out, some of these teens have ended up charged with manufacturing or possession of child pornography, even though the “victims” are the same age, took the photos voluntarily and frequently photographed themselves.

The phenomenon may have taken on an added twist in Virginia. According to a March 7 Washington Post article, an assistant high school principal in Reston is being prosecuted for possessing an “inappropriate” photo of a student taken by another student. Ting-Yi Oei was arrested Aug. 20 and charged with possession of child pornography, as well as two counts of contributing to the delinquency of a minor. Oei’s defense attorney has told the court that he possessed the photo as part of a school investigation into students circulating nude photographs. Nonetheless, he faces a felony charge carrying up to five years in prison.

There isn’t enough information in the article to tell how credible each side’s claims are; the case has not yet gone to trial. However, if Oei truly possessed the photo only because of an investigation, this would seem like a case of prosecutors gone wild. Keeping order at the school is part of a school administrator’s job. Judging by the number of cases of sexting reported in the media, Oei cannot be the first school official to confiscate a phone with naughty pictures on it. The sheriff’s office also originally charged him with failure to report child abuse to parents and authorities. That charge was later dropped, possibly after prosecutors realized that child abuse is not the issue when one minor takes nude photos of another.

If Oei is successfully prosecuted for simply doing his job, it could set a dangerous precedent for all other school officials -- at least in Virginia -- who try to handle sexting problems on their own. And that, in turn, could be dangerous to students accused of taking or possessing the photos. If Florida school administrators risk criminal charges for failing to get authorities involved in sexting cases early, I would have to advise them, as a South Florida cyber crimes criminal defense lawyer, to call law enforcement early in all sexting matters. That would mean that teenagers could end up charged with serious child pornography crimes, rather than having their cases resolved at school.

Here in South Florida, each count of child pornography possession is a third-degree felony carrying up to five years in prison, plus lifelong sex offender registration and other penalties. As I have said before on this blog, I feel that child pornography charges do not fit the crime when minors are accused of voluntarily taking nude photos of themselves, or possessing and transmitting such photos. As a Fort Lauderdale cyber crimes criminal defense attorney, I believe the penalties for a child pornography conviction are inappropriate for these teens. That would be even truer for administrators whose only “crime” was trying to maintain discipline at their schools.

Posted On: March 3, 2009

Fort Lauderdale Cyber Crime Criminal Defense Lawyer on Restitution Payments for Possession of Child Pornography

The Connecticut Law Journal had a story March 2 on a precedent-setting court decision that could have a dramatic effect on my practice as a Miami cyber crimes criminal defense attorney. A man in Connecticut was convicted in federal court of downloading and distributing child pornography. Like most defendants accused of these crimes, he was sentenced to prison time -- in this case, six and a half years in federal prison. As a foreign (British) national who was convicted of a crime, he will also be deported once his sentence is over.

But unlike most child pornography distribution defendants, the man was also ordered by the court to pay financial restitution to one of the minors shown in the pornography. This is the first case that the Law Journal -- or I, as a cyber crimes criminal defense lawyer in South Florida -- found in which someone was ordered to pay restitution for merely downloading and distributing the materials. In previous federal child pornography cases, only people convicted of actually making the pornography have been ordered to pay restitution, and the greatest amount ever ordered was just over 25% of the $200,000 ordered in this case.

A court can (and sometimes must) order people convicted of child pornography expenses to pay financial restitution to victims, but that law specifies a conviction for exploitation of a child. The attorneys in this case disagree over whether that was the case. A private lawyer hired by the victim (in addition to the prosecutor) argues that sexual exploitation is repeated with each new download, regardless of whether the defendant actually had sexual contact with the victim. The defense attorney, by contrast, points out that the victim couldn’t have known when or how many times the materials were downloaded, making it difficult to argue that she was harmed with each new download. He intends to appeal the decision to the Second U.S. Circuit Court of Appeals.

It’s worth noting that there’s another financial dimension to this case. Before his prosecution, the defendant was an executive at a drug company, although he has since been fired. According to the Law Journal, he owned four homes. This may explain the $200,000 restitution order, which was substantially larger than previous restitution orders in child pornography cases -- the judge may simply have decided that the defendant could afford it. The attorney for the defendant speculated that the number of restitution claims might grow if victims and their lawyers see that it’s “...a lucrative area if a defendant has assets.”

As a Fort Lauderdale child pornography possession criminal defense attorney, I am eager to see what the court will say, especially if the idea of financial restitution catches on in federal child pornography cases. Restitution orders are intended to stop people convicted of crimes from profiting from wrong acts, especially if they are enriched at the victim’s expense. Unlike with, say, an illegal download of a movie, the defendant did not steal the victim’s product and deprive her of profit. Nor did he help make the pornography, which would clearly make him guilty of exploiting her. If a restitution order, or any other court order, doesn’t meet the circumstances specified by the law, I do not believe it’s a just order -- no matter how heinous the underlying crime might be.