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08/18/14

Suffolk man played role in largest mortgage scheme ever

A Suffolk County man was charged in federal court in Manhattan Thursday with being one of three principals in an $18.5 million illegal mortgage modification swindle that officials described as the largest ever prosecuted.

Justin Romano, 40, of Blue Point, ran two "purported law firms" used as fronts for a telemarketing scheme that scammed 8,000 homeowners across the country into paying upfront fees in return for fake promises of mortgage relief, a new indictment said.

Romano and co-defendants Ped Abghari and Dionysius Fiumano, both of Irvine, California, got victims in all 50 states who had fallen behind on their mortgages to pay for help with a government program that they could have applied for online, according to the charges.

"These defendants preyed on thousands of homeowners struggling to make their mortgage payments and meet their financial obligations," said U.S. Attorney Preet Bharara.

Romano was arrested Thursday. Appearing in court unshaven, wearing shorts and a Mets T-shirt with ex-star Carlos Beltran's name and number on the back, he pleaded not guilty and was released after agreeing to a $3 million bond secured by two houses and five co-signers.

"This is a massive fraud scheme with victims in all 50 states with tens of millions of dollars in proceeds," prosecutor Edward Diskant told U.S. Magistrate Sarah Netburn.

Romano had no comment leaving court. His lawyer, Stephen Scaring, also declined to comment on the substance of the charges. "We just got a look at the indictment," he said.

The three defendants conspired to buy lists of homeowners who had fallen behind on mortgage payments, and used a telemarketing sales staff to offer assistance in applying for relief under the federal Home Affordable Modification Program in return for thousands in fees, prosecutors said.

In emails and phone solicitations between 2011 and 2014, the charges alleged, they falsely claimed they could get a lower mortgage rate guaranteed or preapproved to convince homeowners to pay the fees, said they would assist with legal services, and then did little or nothing in return.

Romano, who Scaring said is not a lawyer, ran "purported law firms" in Holbrook and Sayville that allegedly employed only one attorney each and were mainly staffed by "processors" who filled out the government program's applications, and employees who made "welcome calls" with misrepresentations.

 

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