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

By JEFFREY B. COHEN |The Hartford Courant

February 14, 2009

National Urban League

National Urban League

Issue	No. of Reports*
Fed Budget & Appropriations	14
Housing	14
Labor, Antitrust & Workplace	14
Education	2
Agriculture	1
Civil Rights & Civil Liberties	1
Economics & Econ Development	1

http://www.opensecrets.org/lobby/clientsum.php?lname=National+Urban+League&year=2008

For more Information Cut and Paste above link

Clark County is holding back federal money from the local Urban League because a recent review found double billing, problems with receipts and a lack of proof that one of the organization’s programs was actually helping the poor pull their lives together.

At issue is a grant of $67,000 that was to be used to help people who were having trouble paying utility bills or rent. The county found that the Urban League paid only part of what clients owed on their bills. The nonprofit organization then asked those clients to pay back 60 percent and billed the county for the same cases. The Urban League issued no receipts to some clients. At other times, clients got receipts but the organization entered the payments under “miscellaneous income.”

And still another finding: There were no plans for helping clients get back on their feet, a condition of the grant.

The Urban League has to correct most of the problems within 30 days to draw again from the grant, said Shawna Parker, analyst at Clark County Community Resources Management, the division that oversees the federal money.

Parker said the problems with the program are serious, adding there are “concerns about whether the organization can manage the money.”

“There is no accounting or justification of the taxpayers’ money, no assurance it is being used wisely and for the purposes it was intended,” she said. In sum, “the goals of the services are in doubt.”

If the money is cut off, it will be the third time in the past four months that a local government has taken back federal dollars from the Urban League. In all three cases, the nonprofit group failed to meet terms of contracts attached to grants, officials said.

Previously, the poverty-fighting organization had trouble meeting the milestones for a $95,000 grant to help seniors repair their homes. The Urban League failed to spend half the money by January. The organization told officials “the program had fallen apart” and suffered excessive turnover, said Tim Whitright, development manager of the Las Vegas Neighborhood Services Department. So the city extended the deadline to March 31. When that deadline wasn’t met, the city took back nearly $70,000 in late May, “a matter of making sure the funds get out to the community,” Whitright said.

The city is managing nearly $5.3 million in federal Community Development Block Grants this year, but hasn’t had a problem of this size with any other nonprofit organization, Whitright said.

North Las Vegas found the Urban League couldn’t spend $57,000 from the same federal source, also meant for repairing the homes of seniors. North Las Vegas took back its money in June.

Parker also discovered more than $110,000 in unspent money for seniors from a $150,000 grant nearly 15 months old. If the money is not used by Dec. 31, it will also be taken back, she said. Further, the county discovered that the $40,000 spent to date went to one contractor. Federal rules require that the work be bid out.

At the Urban League’s board meeting in June related troubles were on the table as board members discussed the need to prepare a plan for cutting programs. In building up its budget to about $4.5 million during the second half of its four-year history, the organization apparently took on too many grants without sufficient qualified staff to handle them.

Executive Director Ray Clarke said in June that his staff would have the reduction plan ready in 30 days.

On Friday, Clarke had no comment on any plan to cut programs, the county’s findings, or the earlier pullbacks of funding.

Instead, he encouraged taking a firsthand look at “the positive impact that the Las Vegas-Clark County Urban League is having in the community,” adding that he is “very encouraged by the progress (the organization) continues to make.”

From the Las Vegas Sun

Staff at the Minneapolis Urban League has been a buzz about recent budget cuts. One MUL staffer who wishes to remain unidentified says, “I hope the $14,000 that my program is not getting doesn’t affect my job.

It has been alleged that the Minneapolis Urban League will not be getting 4^th quarter dollars from the McKnight Foundation. In a ”leaked” letter to the MUL, the McKnight Foundation will not move forward on a grant request for the Minneapolis Urban League favoring an “operational review.”

Is it time for the Minneapolis Urban League to have a Sigma Six review?” (A Six Sigma is a philosophy that mandates operational excellence. This operational excellence is achieved through tools designed to reduce variations in processes. Six Sigma is also considered as a disciplinary methodology by many companies to meet client expectations. As per the philosophy, Six Sigma is not something else that is required to be done but it is what is required to be done.”)

A call made to the McKnight Foundation about the alleged letter regarding stopped funding for the Minneapolis Urban League, and the Foundation being in favor of an operational review, Tim Hanrahan, Communication Director for the McKnight Foundation says, “We don’t have a set amount we give to any programs but we did give the MUL a $50,000 dollar grant for operating support In 2007, (a one year grant).

In an email sent to the Independent Business News Network (IBNN) from the McKnight Foundation’s communications director, Tim Hanrahan – it reads, “After McKnight’s board of directors approves each new grant; we generally follow with a public announcement of the approval. I can tell you that McKnight’s most recent approved grant to the Minneapolis Urban League was for $50,000 in 2007, to support operating expenses. Beyond disclosing approved grants, however, McKnight simply doesn’t comment about confidential discussions with prospective grantees or community partners. Please let me know if you have any additional questions.”

What does this mean for the Minneapolis Urban League? The Minneapolis Urban League established the relationship with the McKnight Foundation in 1972’s when Russ Ewald was the Executive Director of the Foundation and Ms. Virginia McKnight, the matriarch of the McKnight Family made sure that the community in North Minneapolis and all underserved areas in the Twin Cities were being served by the Foundation. As they continue to do today.

There has been a good relationship throughout the years between the Minneapolis Urban League and the McKnight Foundation. Long time community leaders and activists don’t understand why–with the exit of Mr. Clarence Hightower and the upcoming layoffs in January the Minneapolis Urban League has not committed to a Capital Fundraising Campaign or a Membership Drive to assist in building capacity for the organization. The MUL may be facing difficult funding times ahead.

It has been observed that the Minneapolis Urban League, its programs and employees have worked in silo’s “within the building”, opting for the most part not to include other interoffice groups and programs in an effort to create an inept since of competition that cannibalizes the organizations programs, events and employees. For the most part the institution has become an institution unto it’s self – with consequences that don’t favor a productive community social-service organization delivering education, wealth and independence to their target demographic.

A fine example of this is Mr. Hightower’s going away celebration. While the event was going on downstairs, there was another meeting going on upstairs. In our views we think that Mr. Hightower’s celebration trumped anything else going on.

The second example was when the University of Minnesota–School of Medicine had their liaison for the Quit Smoking program interviewing people at the Minneapolis Urban League. The first group to participate was employees from the Social Wellness Cluster at the Minneapolis Urban League – the reward for taking part in the research was a $50 dollar Target Gift Card. We are not against Capitalism – but at the expense of the community turns into an issue. If it was about making a buck – in some cases the community wasn’t alerted including RFP’s (Request for Proposals) and other “soft-services” that could be completed by the community/business talent pool.

The Minneapolis Urban League, outside of its annual dinner is without a fundraiser this year. If questioned different people in the organization as to why the organization failed to mirror other successful social-service agencies in the Twin Cities and around the country by using marketing and communications to assist in creating an in-house source of new funding streams and build capacity through membership drives, the question went unanswered.

From Independent Business Network

At the Urban League’s September board meeting, the first since June, a state official showed up with a list of things the poverty-fighting organization had to do to keep receiving $2.6 million a year in federal funds.

But the board put off the official and the list for another day, one of the latest examples of the organization’s recent tendency to miss deadlines and avoid dealing with problems.

The to-do list was put together in April and May, but at least four items were months overdue, including one on financial oversight — the heart of the board’s responsibility.

Gary Gobelman, the state official, said to the nine board members present, “It’s important for you to understand this.”

But within five minutes, board Chairman Raymond Specht tabled the item for at least another month, “out of respect for the time of everyone here.” It was 5 p.m., quitting time, according to the agenda.

First he asked whether anyone had any questions about the state’s three-page, 13-item list — three times. Board member Napoleon McCallum replied, “I just got this today.”

A few board members said they thought several of the problems had been fixed. Later, Gobelman, whose job it is to make sure the federal funding is properly handled, said they hadn’t been fixed.

The official said he was “surprised and disappointed” by the experience.

He pointed out that the “issues were out there” for months before the meeting, and that he’d expected the board to dedicate some time to them.

“It’s very important for the board to have an understanding of these issues, and I saw this as an opportunity for the board to have a dialogue,” he said.

It’s also important because the state is one of four Nevada governments in recent months to confront problems with the nonprofit organization’s handling of public money. Since May, Las Vegas, North Las Vegas and Clark County have withdrawn or frozen funding because of those problems.

This has a snowball effect among sources of public funding as they begin to compare notes. For example, the Southern Nevada Workforce Investment Board, which receives federal money to help with job training and education, has been considering the Urban League for a grant of about $200,000.

The investment board is taking a close look at the nonprofit organization’s finances before making a decision and plans to meet with its staff to address concerns.

“We know local governments have had fiscal management issues (with the Urban League) in the recent past,” said John Ball, executive director of the investment board.

“We’re dealing with public money ... and this puts the issue on the radar screen for other potential funders.”

At the Urban League’s Sept. 24 board meeting, one item on the state’s list noted that the board was supposed to develop procedures for overseeing the organization’s funding by July 18 and had yet to do so. The procedures were to deal with cash flow, budget approval, appropriateness of expenditures, spending plans, and methods for fixing fiscal problems. Gobelman said the Urban League had sent him a letter saying it would have board Treasurer William Raihl sign a monthly “financial certification form” — but that’s not enough.

“We need a complete picture of the procedures the board will use to maintain oversight,” Gobelman said.

The Sun’s repeated attempts to reach Specht to ask about the meeting and the state’s list, particularly the item dealing with board responsibilities, were unsuccessful.

Gobelman said he wants to meet with the Urban League board’s finance subcommittee before next month’s full board meeting, to “make sure they understand what the status of this is and why they need to be involved.”

In any case, deadlines don’t die, and the Urban League missed another one Friday. The organization was supposed to explain its July payroll in more detail to the state, after its June bill to the state for payroll resulted in $12,000 in disallowed costs. Gobelman said the state will not pay August’s bill, which is likely to arrive any day, until July’s bill is clarified.

Two other items were due Tuesday. First, the Urban League’s financial report was due to the state. The second involved “time studies” — the Urban League has to show the state how employees are spending their time and whether they’re working in activities covered by the grants being billed.

What happens if those deadlines aren’t met?

“Nothing’s been decided on that yet,” Gobelman said.

From the Las Vegas Sun