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P R E S S   R E L E A S E


July 30, 2012


A federal jury in Brooklyn returned a verdict late yesterday convicting attorneys Matthew Burstein and Aaron Rabinowitz on ten felony counts for participating in a mortgage fraud scheme that resulted in over $25 million in fraudulently-obtained loans from Countrywide Financial, Fremont Investment and Loan, IndyMac Bank, Sun Trust Mortgage, Inc., Wells Fargo & Company and New Century Mortgage Corporation.

The convictions were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, Janice K. Fedarcyk, Assistant Director-in-Charge of the Federal Bureau of Investigation, New York Field Office, and Jon T. Rymer, Inspector General, Federal Deposit Insurance Corporation.

During a seven-day trial, the government's evidence established that, from January 2006 to September 2008, the defendants, partners at the law firm Burstein & Rabinowitz located in Forest Hill, Queens, worked as attorneys at real estate closings for fraudulent home sales in New York City. The defendants, who would act as both the bank settlement attorneys and the buyers' attorneys at the closings, worked with co-conspirator real estate agents and loan officers to falsify loan documents in order to induce banks to give mortgage loans for properties located in Queens, Brooklyn and Long Island. Many of the properties were purchased by "straw buyers" who had been recruited by the co-conspirator real estate agents and loan officers to purchase the properties. In many instances the straw buyers subsequently failed to make mortgage payments to the lending institutions, and as a result millions of dollars of loans are now in default. The defendants profited by paying themselves attorneys' fees from the mortgage loan proceeds.

"The defendants violated the trust placed in them as attorneys and further damaged the integrity of the real estate market," stated United States Attorney Lynch. "We will vigorously investigate and prosecute those who engage in mortgage fraud, including professionals who jettison their responsibility to reap rewards from the fraud." Ms. Lynch extended her grateful appreciation to the Federal Bureau of Investigation and the Federal Deposit Insurance Corporation.

Sentencing is scheduled for November 26, 2012. The maximum term of imprisonment for conspiracy to commit bank and wire fraud is 30 years. The government is also seeking an restitution from the defendants and forfeiture of the criminal proceeds, including a criminal forfeiture money judgment in the amount of proceeds traceable to the offenses.

The government's case was prosecuted by Assistant United States Attorneys Matthew S. Amatruda and Robert T. Polemeni.

The Defendants:

Age: 40

Age: 40

Source: United States Attorney's Office for the Eastern District of New York

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