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Georgia Attorney Sentenced to Prison for Mortgage Fraud
Raymond Costanzo, Jr., 63, of Clayton, Georgia, was sentenced last Friday to three years, five months in prison, followed by four years of supervised release, and was ordered to pay $7,843,184 in restitution related to charges of bank fraud and conspiracy in a multi-million dollar mortgage fraud scheme.
From 2004 through 2006, Costanzo participated in closing millions of dollars in fraudulently inflated mortgage loans for unqualified straw borrowers. These straw borrowers were paid as much as $600,000 from fraudulently obtained loan proceeds through shell companies. Costanzo himself obtained mortgage loans totaling over $1.5 million by providing lenders with false qualifying information, and he also falsified down payments. Costanzo received $250,000 in scheme proceeds from this transaction, and arranged for disbursements of fraudulently obtained loan proceeds to co-conspirators.
Such blatant fraud by a licensed professional and real estate market ‘gatekeeper’ cannot be tolerated, which is exactly what U.S. Attorney David Nahmias said about the Costanzo case. “Closing attorneys are the lenders’ eyes and ears at the closing table and must guard against mortgage fraud,” Nahmias said.
The integrity of closing attorneys is essential in the effort to prevent real estate and mortgage fraud. Attorneys who choose to be part of the fraudulent transactions rather than part of the solution should understand that their future may be in a federal prison, right alongside Raymond Costanzo, Jr.
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