Two New York residents were indicted for orchestrating what authorities termed a home mortgage fraud Ponzi scheme that scammed victims out of at least $1 million. Loronda Murphy, 47, and Scott Forcino, 45, were charged with varying counts resulting from the alleged fraud. Murphy faces nineteen counts, including residential mortgage fraud, grand larceny, falsifying business records, and conspiracy. Forcino, who is an attorney, was charged with scheme to defraud, conspiracy, and criminal facilitation. Each faces multiple years in prison if convicted.
According to prosecutors, Murphy and Forcino operated Settle One Corporation with an office in Armonk, New York. Prospective victims were enticed to take out a new mortgage on their home, with the understanding that the new mortgage proceeds would pay off the pre-existing mortgage. Murphy would pose as a closing attorney, and stole the money from the new mortgage rather than pay the existing mortgage. From April 2009 to June 2009, the pair swindled five victims, including Murphy's father, out of over $1 million. The proceeds were commingled and in some instances used to make mortgage payments on various unpaid mortgages. Ultimately, the victims were left with the prospect of having to pay off both an existing and new mortgage.
Bond was set for the pair, who are due next in court on September 15, 2011.