Attorney General says Boca Raton man, Johnson Cuffy, is the leader of a mortgage fraud ring
October 16th, 2008
By Dale M. King
CITY EDITOR
Attorney General Bill McCollum has identified a Boca Raton man as the “ringleader” of “an active mortgage fraud ring in South Florida.”
He said his office has filed criminal charges against that man, identified as Johnson Cuffy, and eight other people. They face charges of criminal racketeering, conspiracy to commit racketeering and multiple counts of grand theft.
McCollum said the criminal ring “allegedly used straw buyers and shell companies to defraud various lenders out of at least $1 million.”
He said charges were filed in the 17th Judicial Circuit against Cuffy
and co-defendants Lillia Cuffy, Cliff Johnson, Joy Williams, Frumence
Paul, Hans Jeanty, Lloyd Gelu, Paula Augustus and Charles Reynolds.
McCollum said authorities believe the targets of the scheme were financial institutions -- including SunTrust Bank, Wachovia Bank, Bank of America and General Motors Acceptance Corporation (GMAC).
Straw Buyers
Using his co-defendants as straw buyers, said McCollum, Johnson Cuffy would apply for mortgages from the various lenders, thereby obtaining properties by fraudulent means.
Once the mortgage loans were secure, the AG said, the co-defendants would pose as the property owners and request additional home equity lines of credit from the lenders.
The participants kept portions of the proceeds and laundered the remaining funds through non-existent companies to Johnson Cuffy, who used his companies – BlueKap Financial and Capitol Investment Group – to disguise his financial dealings.
Coincidentally, Cuffy and Williams were arrested recently in Boca Raton after Williams allegedly cashed fraudulent checks on two consecutive days at a local Chase Bank. Boca Police Public Information Officer Sandra Boonenberg said the bank was tipped off by the owner of the bank account, a resident of New York.
At the time, Boonenberg said local police were working with the Department of Financial Services Division of Insurance Fraud on a further probe of Cuffy and Williams.
McCollum said Cuffy, who was on probation in Broward
County for second-degree grand theft related to mortgage fraud, has been taken into custody along with Lillia Cuffy, Paula Augustus and Charles Reynolds. The other co-defendants are being sought on active criminal warrants, he said.
If convicted, they could face prison sentences ranging from 24 to 420 years.
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