Two Fairfax residents pleaded guilty in federal court last week for their roles in a $1.5 million mortgage-fraud scheme. They are Peter Kim, 39, and Erin Cullen, 32.
In addition, in the four-count indictment returned last Thursday, May 17, by a federal grand jury, Jea Min Lee, 34, of Centreville, was charged with engaging in a conspiracy to defraud financial institutions into making fraudulent mortgage loans.
Authorities say the conspiracy reportedly involved a mortgage broker, an unqualified straw buyer, an executive from a title company, and multiple intermediaries who prepared and approved fraudulent loan documents.
According to federal-court documents, the total amount of mortgage loans approved through the alleged conspiracy exceeded $1.5 million. As a result, financial institutions suffered losses of more than $700,000.
The indictment alleges that Lee and five co-conspirators "prepared and submitted false, fraudulent and misleading mortgage-loan applications for an unqualified buyer who would not have otherwise been approved for the loan. The fraudulent applications contained false information regarding the applicant’s employment, income, assets, immigration status and intent to live in the property as a primary residence."
According to court documents, "One month after conspirators fraudulently obtained $1.2 million in mortgage loan proceeds, they [reportedly] applied for and fraudulently received a $350,000 home equity loan, the proceeds of which were distributed among some of the conspirators."
The indictment states that Lee and his conspirators allegedly "created fake documents to corroborate false information contained in fraudulent loan applications – including a fake lease, fabricated bank statement and a bogus W-2. One conspirator also falsely verified another conspirator’s employment in order to qualify for the loan."
The mortgage-fraud scheme involved a home in Gainesville and, last week in U.S. District Court in Alexandria, Kim, Cullen and three other conspirators pleaded guilty to conspiracy to commit wire fraud. They are Bok Hee Lee, 37, of South Riding; Jai Sek Lee, 50, of Ashburn; and Jai Song, 41, of McLean.
They each now face a possible maximum penalty of five years in prison when they’re sentenced by U.S. District Court Judge Anthony J. Trenga. Kim pleaded guilty May 16 and will be sentenced Aug. 17. Cullen pleaded guilty May 17 and is set for sentencing on Sept. 7.
However, although Jea Min Lee was indicted, he has not yet been arrested or appeared in court. That’s because he is still at large and his whereabouts are currently unknown.
This ongoing investigation is being conducted by the FBI’s Washington Field Office. Assistant U.S. Attorney Uzo Asonye is prosecuting the case.