Prosecutors have dropped mortgage fraud charges against a man accused of skimming home equity from distressed homeowners

The case against Thomas Cuomo could not stand in the wake of an e-mail and paper trail showing the mortgage company he was working with wasn't the victim of fraud - but instead the possible cause of it.

Cuomo, who once was a housing counselor for the Jacksonville Urban League, bought homes from people in foreclosure. At one time, he was suspected of skimming out what equity had been built up and renting them back to the original owners, promising them a chance to buy the houses back.

But the houses slipped back into foreclosure.

He was first charged in 2007 with money laundering and mortgage fraud after state investigators found similar stories from nearly a dozen people in Duval and Clay counties. That case was dismissed on a technicality.

In 2008, he was charged again, this time accused of taking out fraudulent loans.

Mitchell Stone, Cuomo's attorney in the 2008 charges, but not the previous case, said a simple e-mail trail showed that Cuomo tried to correct wrong information on his mortgage applications. For example, he said, loan documents said one of the homes was going to be owner-occupied, but Cuomo tried to correct the information to say it would be a rental.

It was Countrywide and other lenders, according to Stone, that refused to correct the wrong information so that it could make the loan, then bundle and sell it with other risky mortgages. The case is a microcosm of the wider mortgage meltdown that has sent the economy into a tailspin.

April Charney, an attorney at Jacksonville Area Legal Aid and one of the nation's experts in foreclosure law, is defending one of the foreclosures on behalf of the tenant, Lester Thomas, who sold his house to Cuomo. Thomas still lives there because the bank has not been able to prove it has the right to foreclose on it.

Charney said the case represents many of the problems with the mortgage crisis: Irresponsible lenders and irresponsible borrowers, scams perpetrated on low-income people in dire straits and the improper securitization of high-risk loans.

And, she said, it illustrates why law enforcement agencies must put more effort into investigating such cases.

From Jacksonville News

ALBANY -- Aaron R. Dare, former Urban League president, pleaded guilty Monday to a felony charge related to a real estate scheme that is expected to land him in state prison for up to three years.

Jury selection in the case was scheduled to begin when Dare accepted the plea deal. It leaves open the prospect Dare could face additional charges -- and prison time -- for alleged real estate crimes still being investigated by State Police and the Albany County district attorney's office.

Dare is scheduled to be sentenced in federal court next month for another series of real estate crimes. He faces up to 51 months in federal prison under a plea agreement signed in November 2006 in that case.

But the federal deal could be jeopardized because Dare has admitted committing a felony while free on bond in the federal case. He faces a maximum of 27 years in prison for the federal conviction on three felonies, including mail fraud.

Dare was once a rising star in Albany but his reputation was tarnished amid repeated financial failures and criminal investigations of corrupt deals that have left a wave of financial destruction across the city.

The deals resulted in dozens of foreclosures and several victims said they were duped by Dare and his former business partner, Albany police Detective Kenneth Wilcox, who died in a car crash in April 2006.

Monday's plea involved the sale of a single property in the South End last year. Dare admitted filing a fake property deed that concealed his role in the $150,000 sale. The woman who bought the home is facing foreclosure and may not even own the property, prosecutors said.

The corrupt deal is similar to Dare's federal crimes, including 31 instances of mortgage fraud. Those deals involved Wilcox, who also was a target in the FBI investigation.

Dare, dressed in a suit jacket, spoke little during Monday's proceeding before acting State Supreme Court Justice Dan Lamont.

"Are you guilty of offering a false instrument for filing?" Lamont asked.

"Yes, sir," Dare responded, showing no emotion.

Lamont allowed Dare to remain free on $25,000 bail pending sentencing in June. Dare also is free on bond in his federal case but is restricted to home confinement and must wear an electronic monitoring bracelet.

Federal prosecutors have declined to identify the 31 properties -- most in Albany -- that Dare and Wilcox allegedly used to commit mortgage fraud. By not including that information in the plea agreement, it's unclear whether some people may have been victimized and don't know it.

In the State Police case, an unidentified source who once worked for Dare told investigators "Dare has defrauded mortgage companies of several hundred thousand dollars" and "would take two and sometimes three mortgages on the property without telling the owner of the house," according to an affidavit contained in court records.

In articles published last year, the Times Union outlined similar findings following a months-long examination of property deals that were set up by Dare and Wilcox.

The newspaper uncovered instances in which Dare and Wilcox allegedly sold houses they didn't own, filed forged deeds, used appraisers who placed arguably inflated values on properties and duped an untold number of people into believing they were buying refurbished rental properties that could turn a profit.

From Times union

Brother of former New Orleans mayor sentenced to home detention for not filing tax returns

The Associated Press
Thursday, January 10, 2008

The brother of a former New Orleans mayor whose administration has been the target of a long-running corruption probe was sentenced Wednesday to six months of home detention for failing to file federal tax returns.


Jacques Morial, 45, pleaded guilty in September to three misdemeanor counts of the tax charges. Each count carried a maximum sentence of one year in prison and a $25,000 fine.


U.S. District Judge Mary Ann Vial Lemmon also sentenced Morial to three years of probation. Prosecutors did not object to home detention.


Prosecutors and defense attorney Pat Fanning said Morial has paid more than $26,600 in taxes he owed for the tax years 2000 through 2002, when he was a political consultant and radio producer.


Morial's brother, Marc, was mayor from 1994 to 2002 and is now head of the National Urban League. Their father, the late Ernest Dutch Morial, was the city's first black mayor, serving from 1978 to 1986.


Reading from a prepared statement, Jacques Morial apologized to the court and his family and friends and blamed his failure to pay taxes on procrastination, not a desire to cheat the government.


"I am extremely ashamed that my family's good name, earned over generations of community service, may be tarnished in the eyes of some because of me," Morial said.


Marc Morial was not at the hearing. The former mayor has not been accused of wrongdoing, but his administration has been the subject of a corruption investigation that has landed several former city officials in prison. Prosecutors have not said the Jacques Morial tax case is connected to that investigation.


U.S. Attorney Jim Letten has said that Morial was not targeted because of his brother.

From International Herald Tribune

URBAN LEAGUE SAYS IT'S DEAD, CLOSING FRIDAY.
NATIONAL ORGANIZATION WAS SEVERING ITS TIES
By Anthony J. Gottschlich, Springfield News-Sun
April 23, 2002

The Springfield Urban League and Community Center will close Friday, the nonprofit organization's executive director said Monday.

Donna Brino-Blackwell said 16 employees will be laid off and the League's programs, for the most part, will cease.

"Everything happens for a reason," said Brino-Blackwell, 46, who has directed the League since 1991.

She said the remaining four board members will lay her off by April 30 _ "because I'd done nothing wrong to be terminated" _ and then resign themselves.

Friday could be the end of the League's four-decade existence in Springfield.

Brino-Blackwell's announcement followed a statement released earlier in the day by National Urban League officials, who said they planned to cut off its affiliation with the Springfield League next month, pending approval by the national group's board of trustees.

The decision is based on the failure of Brino-Blackwell and her board to correct troubles identified by the National League more than a year ago, national officials said in a press release. The troubles involve operational, financial and board-governance issues, the statement said.

"Our hearts go out to the affiliate staff and volunteers who dedicated time and energy into serving their community, and we empathize with a community that will likely feel a great void as well," said Annelle Lewis, the national organization's senior vice president for affiliate development.

Brino-Blackwell said she was disappointed by the national League's decision, but not surprised by it. She declined to comment on the national group's charges, saying, "I'm trying to reach national myself."

According to the press release, Springfield can continue to have an Urban League presence here, "perhaps through another Ohio-based affiliate." But that would be up to the community and the League's current and former funding sources.

Local officials weren't surprised by the news Monday. They expressed hope that at least the League's mission would remain here.

"I think it's important there be an agency in Clark County that represents an Urban-League type of mission and help for the minority community," said Doug Lineberger, executive director of the United Way of Clark and Champaign Counties. "Whether or not it is an Urban League remains to be seen."

The consensus at a town hall meeting Saturday at City Hall was that Springfield wants and needs an Urban League.

Tony Hutchins, the local attorney who ran the meeting, said Monday he hopes national League officials will modify their position so Springfield can maintain an Urban League here with some local control.

"We've always preferred that it be an independent entity, but we are open to all the possible discussions that need to take place, not just with the national Urban League, but with the funding sources as well to see what the issues are and the best way to be viable in the long term," said Hutchins, who represents a group of clergy concerned about the League.

Hutchins is compiling a list of community members to assess the Urban League's situation, get names of possible new board members and evaluate the effectiveness of Urban League programs. Identified community members include former Springfield mayors Robert Burton and Dale Henry, former Springfield Police Chief Roger Evans and former Urban League board members James Qualls, Lymon Alexander and Colleen Buscemi, among others.

Hutchins expects the committee to meet with funding sources soon. He also said the Dayton Urban League could become a key ally in the process.

Dayton Urban League Executive Director Willie Walker could not be reached for comment.

"We got our work cut out between now and next month," Hutchins said.

In the meantime, Lineberger said the United Way is willing to help ensure there's no disruption in services at the Craig House, the League's homeless shelter at 1417 S. Limestone St.

Brino-Blackwell said she's confident the League's troubles can be turned around. She wants to help with the transition between the existing operation and the new local group poised to take over.

"I'm sure there's a way that this can be worked out with the national (organization) and with the local constituency," she said. "I stand ready to meet with anyone."

She said some of her staff are willing to stay on as volunteers in the meantime.

Brino-Blackwell joined the Urban League as a volunteer in 1987. She later became a secretary and then assistant to then-executive director Charles Nesbitt. When Nesbitt resigned in 1991, the board promoted Brino-Blackwell to interim director. The board removed ``interim'' from her title in March 1992.

"I've been judged for sure, but I wish I'd be judged on my work," Brino-Blackwell said.

"What's important is this: The Urban League is bigger than any one person or any group."

The nonprofit, tax-exempt Urban League was founded in 1963 to empower African-Americans and promote racial, economic and social equality. The League has worked over the years to provide shelter for the homeless, assistance to crime victims, job-placement services and other programs for the needy.

In February this year, the Springfield News-Sun began a series of stories detailing the League's financial mismanagement, contract violations with its funders, program problems and debts.

The league has lost the bulk of its funding from several key sources since then, including the Clark County Department of Job and Family Services, the United Way of Clark and Champaign Counties and the Eastern Miami Valley Alcohol, Drug Addiction and Mental Health Services Board.

Leslie Dunbar, the national League's spokeswoman, said the national group doesn't have the power to remove the local League's administration or board of trustees because each affiliate is its own corporation.

From Best of Cox Award

‘CLEAN SWEEP' URGED.
LOCAL NAACP LEADERS ADVOCATE OVERHAUL AT URBAN LEAGUE
By Anthony J. Gottschlich, Springfield News-Sun
April 18, 2002

The Springfield chapter of the National Association for the Advancement of Colored People on Wednesday called for a "clean sweep" at the Springfield Urban League and Community Center, once a strong ally.

"There's no question there needs to be drastic change over there," local NAACP President James Bray said. "A clean sweep."

Bray's comments came during a visit this week by representatives of the National Urban League, who are here to check into their troubled affiliate, which has lost the bulk of its funding in recent weeks because of contract violations, financial mismanagement and other problems.

"We don't want in any way to harm the Urban League, because Springfield and Clark County need the Urban League and all that it stands for," said Bray, whose remarks were supported by Arnett Hardnick, the NAACP's fair housing chairwoman and mediation coordinator.

"All we are asking, as a national organization, is that the community rally so that the Urban League can remain here with its programs intact (and) that there's accountability from top to bottom so that the community's confidence is restored," Bray said.

Springfield Urban League Chairman Ron Ross resented Bray's statements, saying the NAACP should tend to its own business.

"They can't afford to be throwing stones at people," said Ross, a longtime NAACP member and former local chapter president. "I'm a full-blooded NAACP member, and they should be doing the job like they're supposed to be doing."

Hardnick has mounted an Urban League membership drive in recent weeks and said she has enlisted about 50 new members. She wants to sign up enough new members to force a leadership change at the League, although she isn't sure who the new leaders should be.

"We got to keep it real, and we got to keep it honest," Hardnick said. "And I think the community deserves full disclosure of all financial records — what came in, what went out."

Bray and Hardnick hope local community leaders support their position. Several did on Wednesday, saying a change in leadership is necessary for the League if it is to be effective in the community.

"It's absolutely imperative there's a clean sweep, because I think it's important for credibility that it start afresh," said State Rep. Merle Grace Kearns, a Springfield Republican and longtime Urban League member.

Springfield Mayor Warren Copeland said, "My sense is that the various organizations that provide funding are going to be reluctant to restore funding without that kind of a change. So if the only way we can keep an Urban League in Springfield is for that kind of change to occur, then I think it needs to occur, because I think we need an Urban League."

To date, the Urban League has seen about $391,000 of its funding terminated or suspended this year, including $125,000 from the United Way of Clark and Champaign Counties and $143,000 from the Eastern Miami Valley Alcohol, Drug Addiction and Mental Health Services (ADMH) board.

The cuts follow a series of stories in the Springfield News-Sun about the League's problems.

"If they'd done a clean sweep a month ago, it would have offered our board a chance to perhaps go into a rebuilding mode with them instead of terminating our contract," ADMH President Paul VanderSchie said.

City Commissioner Kevin O'Neill and Clark County Commissioner John Detrick agree with the NAACP.

City Commissioner Dan Martin isn't so sure.

"Obviously something's broken down there, and I'm not sure what it'll take to get it back on its feet," Martin said.

City Commissioners Joyce Beverly Casey and Martin Mahoney couldn't be reached for comment.

State Rep. Ron Rhine, D-Springfield, said he will withhold judgment until the national league releases its findings.

"The Urban League has done a lot of good things for this community throughout the years, but to call for a clean sweep? I can't say that," Rhine said.

National Urban League officials declined to comment Wednesday, but are expected to release a statement today.

"There's nothing to report right now," said Leslie Dunbar, the national league's spokeswoman.

STATE AGENCY HALTS FUNDING.
AUDIT TEAM WILL EXAMINE URBAN LEAGUE PERFORMANCE
By Anthony J. Gottschlich, Springfield News-Sun
February 12, 2002

The Ohio Department of Development has frozen its funding to the Springfield Urban League and Community Center pending a departmental investigation into the Urban League's financial troubles, a department official said Monday.

The department's latest grant of $48,400 partially funds the Urban League's homeless shelter, the Craig House at 1417 S. Limestone St.

The department will send an audit team to the Urban League on Feb. 25 to determine how the League is using department funds, said Marlo Tannous, the department's chief legal counsel. The department also will investigate whether any contract provisions were violated, she said.

"If they've misspent the money, certainly we'll ask for it back," Tannous said. "If they have used the money as they have indicated, unless there's some other thing revealed in the audit, we would probably not seek a return of the money."

Any further action depends on what the audit reveals, she said.

Urban League officials, including Executive Director Donna Brino-Blackwell, referred questions to their attorney, James R. Greene III of Dayton.

"I'm a little surprised because the ODOD has not released the funds and they are not scheduled to be released until April, so there cannot be a freeze of something that hasn't occurred," Greene said.

"We welcome their audit," he said. "If ODOD finds something wrong, we'll fix it. If there's nothing wrong, we expect them to follow the law and not doing anything that's adverse to the client populace which we serve. Otherwise, I'll deal with them appropriately."

A Feb. 3 story in the Springfield News-Sun revealed the Urban League had not provided state-required workers' compensation insurance to its employees from Sept. 1, 1996, until Jan. 29 of this year. The lapse violated contract agreements between the Urban League and several of its funding sources. The Clark County Department of Job and Family Services terminated its contract with the Urban League because of the lapse.

The story also detailed audit report findings that included past tax debts to the state of Ohio and city of Springfield and other financial management concerns.

Last July, Brino-Blackwell signed a contract with ODOD affirming the Urban League had workers' compensation insurance and had no outstanding debts with the state of Ohio. The contract stated that any false statements made to secure the grant could be grounds for a falsification charge.

It's too soon to make that charge, Tannous said.

"We just need to do our homework and check all the facts," she said.

Tannous said the investigation could take a couple of weeks. While no funds are scheduled to be released for a while, she said, freezing funding was a precautionary measure in case the Urban League made an early request for reimbursement, as agencies may do.

The Craig House is funded by at least two other sources _ the city of Springfield and the United Way of Clark and Champaign Counties.

The Urban League, a nonprofit, tax-exempt charity at 521 S. Center St., runs a variety of programs designed to help the poor and disenfranchised reach economic and social self-sufficiency. Programs include housing and education, a food pantry and assistance to victims of crime.

"This agency is like any other agency _ they have their ups and downs," Greene said. "But one thing that is clear is that we do need to correct some things, and that is my mandate. The board has retained me to ensure we're in compliance with the law and in compliance with program requirements, and we will get to that point as quickly as possible if we're not there already."

From Best of Cox Award

COUNTY ENDS SUPPORT FOR PROGRAM.
THE URBAN LEAGUE'S FAILURE TO PROVIDE WORKER'S COMPENSATION INSURANCE FOR EMPLOYEES WAS THE LAST STRAW, OFFICIAL SAYS
By Anthony J. Gottschlich, Springfield News-Sun
February 2, 2002

Jean Chepp was disappointed.

The Clark County Department of Job and Family Services spent time and money training a Springfield Urban League employee to manage Project E.C.H.O., an Urban League program at 426 Lincoln Park Circle designed to give ex-convicts _ men and women _ a fresh start, a chance to rebuild their lives by providing job training and other skills.

But when Chepp, a program specialist with Job and Family Services, reviewed E.C.H.O. in November, she found "incomplete record keeping and careless documentation," as well as services that were advertised but not provided _ all of which raised concerns about the program's management and effectiveness.

"I thought we did a good job training the contractor, and I thought, ‘Is this something that was really misunderstood? Are they taking this seriously?'" Chepp said. "I was just wondering if I had not made myself clear."

Janine Miller, program manager for E.C.H.O. (Ex-Offenders Can Have Opportunities), refused to comment on the program, as did Urban League Executive Director Donna Brino-Blackwell.

The Urban League sponsors a bevy of programs designed to lift the poor and disadvantaged from a life of poverty, crime, drug addiction and other troubles. A story in Sunday's Springfield News-Sun detailed the charity's financial troubles, which the Urban League attributed to cash flow problems, fund-raising difficulties and other challenges. Job and Family Services, whose latest contract provided $74,000 for the E.C.H.O. program, gave the Urban League six weeks to get the program's paperwork in order. But by the time the Urban League submitted the revisions, which Chepp said still contained some errors, it was a moot point.

Job and Family Services terminated its contract with the Urban League on Tuesday, after learning the nonprofit organization hadn't provided workers' compensation insurance for its employees since 1996, a requirement of state law and the contract.

"They signed the contract with various assurances in there, one of which was that they had this coverage, and they didn't," said Job and Family Services Director Bob Suver. "So that shows they misrepresented themselves when they signed the contract, and that was just kind of the final straw."

The termination is effective Feb. 28.

It is unclear how many organizations fund the E.C.H.O. program or whether it can survive in light of the cuts. Local churches and the Clark County Sheriff's Office have supported the program in the past.

Brino-Blackwell assured Suver in a letter Tuesday that the Urban League had made arrangements to pay the Ohio Bureau of Workers' Compensation and that it was now covered by the insurance and in compliance with the contract.

Too late, Suver said.

"There's about three different places in that contract that says they have (workers' compensation) and will continue to have it," Suver said. "They didn't do either and they signed the contract, so I don't appreciate that."

Workers' compensation is a basic requirement, he said, and if the Urban League couldn't provide that, "How could I believe they could accomplish being successful with Project E.C.H.O. clients in getting them employed and on a successful path?"

"So it just totally blows their credibility that they could have any hope for that success," he said.

Project E.C.H.O. began in 1999, and Job and Family Services began funding it in January 2000 with an 18-month, $113,000 contract.

The program was designed to help about 25 ex-criminal offenders and their families who are on public assistance and looking toward a life of self-sufficiency. Services include G.E.D. preparation, computer literacy training and job referrals.

The contract was renewed in July last year for $109,000, but amended to $74,320 because of state cutbacks. The county also implemented a new rule during that time, one requiring its contractors, instead of county departments, to determine the eligibility of program participants.

That's why Chepp reviewed the program in November _ to see how Miller and others were performing that task, she said.

"The staff seemed very helpful and committed to serving the customers of the Urban League," Chepp wrote in a Dec. 11 memo to Brino-Blackwell. "When talking with Janine about Project E.C.H.O., I sensed a commitment to her clients and a desire to help all of them reach self-sufficiency."

Among Chepp's concerns in November:

• E.C.H.O. staff did not provide services to families of ex-offenders, despite contract requirements.
• Staff had not provided job-readiness training for clients since June.
• Inconsistencies in quarterly reports and monthly invoices to Job and Family Services.
• Of 10 sampled cases, not one was determined to be eligible for the program, because the eligibility forms were incomplete.

The problems with ECHO were unique, Chepp said.

"I visited three other contractors and essentially they received pretty favorable reviews," she said.

Job and Family Services funds its contractors on a reimbursement basis. As of Dec. 31, the department had reimbursed the Urban League $41,553 for the last half of 2001, Chepp said.

Suver said that because of state budget cutbacks, resources are limited, but Job and Family Services would consider funding other programs similar to E.C.H.O.

"We still see a need for some job training and placement help for ex-cons," he said, "and we'll be open to considering where we can put some resources toward that."

From Best of Cox Award

Star Tribune (Minneapolis, MN), November 15th, 1997

A Maplewood man pleaded guilty in Minneapolis federal court Friday to stealing thousands of dollars in federal funds while serving as training director for the St. Paul Urban League.

Thomas Cotroneo acknowledged in court that he gave providers of job training seminars a choice of paying him or risk losing future seminar contracts, according to the U.S. attorney's office. He collected about $28,000 by forcing them to cash their payment checks at a check-cashing business operated by his brother, Frank Cotroneo.

From BookRags