Hyacinth Bellerose, 50 and a real estate attorney, pleaded guilty over one case of conspiracy to commit bank fraud.
According to sentinelandenterprise.com, the conspiracy was to "defraud banks and mortgage companies as part of a conspiracy involving sham "short" sales of numerous residential properties in the Merrimack Valley."
The charge of committing bank fraud is a fine of $1 million and maximum of 3 years in prison and three years of release under supervision. Bellerose was listed as inactive in Massachusetts Board of Bar Overseers.
The U.S Attorney's Office said that Bellerose conspired with a real estate agent from Haverhill and a Methuen loan officer to use bogus short sales of properties in Haverhill, Lawrence and Methuen to defraud banks.
According to the report of the said website a short sale is "a sale of real estate for less than the value of any mortgage on the property. Short sales are an alternative to foreclosure that typically occur only with the consent of the mortgage lender, and that generally result in the lender absorbing a loss on the loan and releasing the borrower from the unpaid balance."
In a report by whav.net, the conspiracy of the three started in August 2007 until June 2010 which include the time of financial crisis and its aftermath. When the home values are much lower than the mortgage value the residents are paying, Bellerose and her cohorts submitted false and misleading papers to different banks "in an effort to induce them to permit the short-sales - and thereby to release the purported sellers from their unpaid mortgage debts - while simultaneously inducing the purported buyers' banks to provide financing for the deals. In fact, the purported sellers simply stayed in the homes with their debt substantially reduced while Bellerose and others made money from the transactions fees associated with the fake sales."
The case is now being handled deputy chief of U.S. Attorney Carmen M. Ortiz's Economic Crimes Unit, Assistant U.S. Attorney Stephen E. Frank.
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