Three Massachusetts mortgage brokers have been arrested for mortgage fraud. But what makes this case interesting is that one of the brokers is pastor at his local Baptist church.
A federal grand jury returned an indictment Thursday against Paul Starnes, Marc Brown and David McCoy for one count of conspiracy to launder money and twelve counts of wire fraud arising out of their participation in a mortgage fraud scheme, according to an announcement from the U.S. Attorney’s office.
Starnes, who was arrested Friday, owned and operated Trinity Mortgage Brokerage Inc., the company where the fraud was committed, the announcement said. Brown, also arrested on Friday, and McCoy, arrested Thursday, worked as brokers at Trinity, The Associated Press reported.
Known as the Rev. Paul J. Starnes, he leads the Morning Star Church in his hometown of Springfield, according to AP.
The three allegedly operated a flipping scheme where they purchased homes in low income areas then quickly resold them at an inflated price.
Trinity employed runners — people who were paid to recruit prospective buyers by telling them there would be no down payments and promising money back at closing, the government claims. Once buyers were found, Trinity allegedly generated fake documents “including bogus down payment information, fraudulent income information, and false documentation to show improvements to the properties that were never made.”
Appraisers and attorneys were induced to participate in the multimillion dollar scheme with promises of more business and “incentive” payments, according to the announcement.
Starnes and the two other defendants each face more than $1 million in fines and 40 years in prison, the U.S. Attorney said.
Ten other defendants were indicted in September for their roles in the scheme, the announcement said.
