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2 Texas LOs Convicted

Jury finds Azza Bassiouny, Kamilla Kirch guilty

July 18, 2011

By VALERIE WIGGLESWORTH The Dallas Morning News - McClatchy-Tribune Information Services

More than three dozen mortgage lenders were defrauded in more than a hundred Texas transactions by a crew of 40 people who, the U.S. Department of Justices alleges, caused $20 million in losses. Two loan originators were found guilty of contributing to the scheme.

A jury convicted two North Texas women this week for their roles in a mortgage fraud scheme involving properties in more than two dozen Texas cities.

Azza Bassiouny, 44, of Dallas and Kamilla Kirch, 65, of The Colony were found guilty on charges of conspiracy to commit mail fraud and wire fraud. The jury deliberated less than 90 minutes after hearing testimony over 14 days in U.S. District Court in Plano. They face up to 20 years in federal prison. A sentencing date has not been set.

Attorneys for the two women could not be reached for comment.

The women were part of a scheme authorities say involved 40 people -- from real estate agents to mortgage brokers to property appraisers -- who "conspired to defraud lending institutions by convincing them to approve mortgage loans for residential properties for which the property values had been fraudulently inflated," according to a news release from the U.S. attorney's office for the Eastern District of Texas.

"Mortgage fraud is a crime that not only causes steep financial losses to lending institutions but also ruins whole neighborhoods by tampering with house values," U.S. Attorney John M. Bales said in the release.

The scheme, which officials say began in 2004, involved at least 114 properties in Texas, including 46 in McKinney and 18 in Fort Worth, as well as properties in Dallas, Houston, The Woodlands, Plano, Allen, Frisco, Arlington, Southlake, Flower Mound, Lewisville and Cedar Hill.

The two women were "loan officers who falsified loan applications in order to dupe lending institutions into making mortgage loans," according to the release. "Bassiouny and Kirch inflated income amounts, listed false employment information, and falsely designated purchases for primary residences. Bassiouny and Kirch also provided false documentation in support of the loan applications, including false verifications of employment, false verifications of deposits, false gift letters, false lease agreements, and fraudulent occupancy affidavits."

Multiple methods were used in the scheme. The indictment detailed several examples, including the sale of a McKinney home for $625,000 even though it was valued at $369,000. A mortgage loan was approved for $562,500, and those involved split the proceeds from the scheme.

Thirty-seven others have pleaded guilty to involvement in the scheme.

John Barry and Allyson Barry pleaded guilty to creating or supporting the scheme. Title attorneys Daniel Ayers and Anthony Flores and escrow officer Debbie Fernie pleaded guilty to closing the property transactions, and real estate agents Joy Beckner, Sheri Brower, Julie Hanley, Elaine Powers and Michelle Strickland pleaded guilty to concealing true property values in the property transactions.

Loan officers Tim Dreslinski, Jared Gowans, Chris Howard, Patty Peery, Allison Ridgeway and Liz Smittle each pleaded guilty to roles in falsifying loan applications for submission to lending institutions. Appraisers Elizabeth Altizer, Pamela Ford, and Josh Melton pleaded guilty to fraudulently inflating the value of houses in their appraisals.

Property flippers Frank Field, Rita Hunter, Shannon Jensen and Andrea Tannahill pleaded guilty to serving as the conduit buyer/seller in property transactions that flipped immediately.

And straw buyers William Barry, Christopher Feagan, Debbie Friedman, Patrick Johnson, Travis Jones, Delisa Kearney, Francis Kearney, Barbara Muzeni, David Muzeni, Kathleen Muzeni, Brett Relander, David Sacco, Ellen Summers and Clarence White pleaded guilty to submitting false loan applications to lending institutions.

A final defendant, William Doug Mitchell, is expected to go on trial this fall.

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