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Waterford man pleads guilty to $1.2 million mortgage fraud scam

By Karen Florin

Publication: theday.com

Published 06/20/2013 12:00 AM
Updated 06/20/2013 04:39 PM

Waterford resident Juan Velez pleaded guilty in the middle of his trial in U.S. District court Thursday to taking part in a $1.2 million mortgage fraud scheme involving multiple properties in New London.

Velez, 60, faces up to 30 years in prison when he is sentenced Sept. 12 by U.S. District Judge Robert N. Chatigny in Hartford.

According to the government, Velez took part in the scheme in 2006 and 2007, acquiring properties and selling them at inflated prices using fraudulently obtained mortgage loans. In pleading guilty to one count of bank fraud, Velez admitted he had sold a property at 624-626 Montauk Ave. to a co-defendant, Flavia Mendoza, knowing that the loan paperwork contained false statements regarding her income, her intention to occupy the property as her primary residence and the amount of money she was providing to purchase the property.

Additionally, the paperwork falsely stated that Mendoza had provided Velez with approximately $29,760 for the purchase when he had not provided any down payment money. Based on the false statements, Mendoza obtained a loan in the amount of $492,699.

Velez, Mendoza and others shared the profits of this and other fraudulently obtained residential mortgage loans, which totaled more than $1.2 million.. Mendoza also has pleaded guilty and awaits sentencing.

The case was investigated by the U.S. Postal Inspection Service, the Internal Revenue Service – Criminal Investigation and the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorneys Michael S. McGarry and Peter S. Jongbloed.

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