Property appraiser gets 33-month term in flipping scheme

Ugorji was convicted of fraud for inflating values of houses

January 24, 2001|By John B. ODonnell | John B. ODonnell,SUN STAFF

G. Samson Ugorji, a real estate appraiser accused of providing more than 300 inflated appraisals for property flips in Baltimore, was sentenced yesterday to 33 months in federal prison.

Ugorji was found guilty in October of seven counts of mail and wire fraud for doing inflated appraisals on houses bought and resold at much higher prices by Robert L. Beeman of Wilmington, Del. Ugorji was acquitted on seven other counts.

Evidence at his trial focused on 42 appraisals for Beeman, who flipped more than 100 Baltimore houses.

In addition to those, Ugorji did 275 inflated appraisals for other property flippers that prosecutors were not allowed to mention at his trial, and he did not report all his income, Assistant U.S. Attorney Joseph L. Evans told Judge J. Frederick Motz.

Appraisals are a key element in property sales, because lenders will not provide mortgages unless an appraiser values the house at the sale price or higher.

Ugorji, 43, was also ordered to perform 250 hours of community service after his release from prison.

Most of the houses Beeman flipped were in the area north of Patterson Park. He and four other defendants pleaded guilty last year.

Others also sentenced

Beeman, who pleaded guilty to fraud, is scheduled to begin serving a three-year sentence next month.

Two principals of Macallan Funding Inc., a mortgage brokerage firm that handled many Beeman transactions, began serving sentences this month.

Michael M. Fishman is serving 30 months at a minimum-security prison in North Carolina while Scott R. Shinskie is serving 18 months at a camp in Cumberland.

Prosecutors had planned to seek a 36-month term for Ugorji, but reduced their recommendation by three months in exchange for Ugorji's agreement not to appeal his conviction.

Ugorji's lawyer, federal public defender Paula Xinis, asked for a further reduction on the grounds that Ugorji's role in Beeman's fraud scheme was minimal.

All he did was appraise properties at the value Beeman wanted, while others had more extensive roles, she said.

Motz wasn't persuaded. "Mr. Ugorji played an important role in this scheme," he said. "Frankly, I don't follow the argument that he wasn't essential. False appraisals are obviously essential to the success of a flipping scheme."

Ugorji told Motz that he was too trusting of Beeman and others and failed to verify information they gave him.

During the trial, he said, "I saw a sophisticated scheme that was morally and spiritually wrong and I am ashamed that my name was associated with that scheme."

Lenders, buyers cheated

Evans said later that Ugorji was responsible for causing lenders the loss of as much as $800,000.

Beeman usually paid between $10,000 and $20,000 for houses and sold them in the $80,000 range.

The buyers often were low-income African-Americans with flawed credit who were told they could own a house for a $500 down payment and monthly mortgage payments of roughly $400.

Evidence showed that mortgages for 55 percent to 75 percent of the purchase price were obtained for homebuyers after Beeman and others falsified documents submitted to the lenders, and that the loans usually exceeded the value of the house.

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