June 06, 2001|By John B. O'Donnell | John B. O'Donnell,SUN STAFF
A Pennsylvania woman who signed 15 government-backed mortgages, often using phony identification, and five other people pleaded guilty in federal court yesterday to their roles in a major property flipping and mortgage fraud case.
The six defendants are cooperating with federal prosecutors and have agreed to testify against William Otto Schmidbauer, a Perry Hall real estate broker, and 10 other defendants who were indicted in April on charges of conspiracy to commit bank fraud and making false statements.
The guilty pleas brought to 19 the number of defendants convicted in federal court in the last 10 months for their parts in illegal property flipping in the Baltimore area. Typically, houses were bought at low prices and sold for more than they were worth, using falsified documents and inflated appraisals.
The six who appeared yesterday before U.S. District Judge William M. Nickerson admitted that they purchased houses from Schmidbauer or through his real estate company and used falsified documents that he supplied to obtain mortgages insured by the Federal Housing Administration. All told, 28 of the 58 houses cited in the Schmidbauer indictment were involved in the guilty pleas.
The government alleges that loans worth $4.4 million were obtained fraudulently on the 58 properties, and that Schmidbauer's gross profit was $1.4 million. The indictment said lenders foreclosed on 48 properties after buyers defaulted, and FHA paid lenders $3.9 million in insurance claims.
Fifteen of the houses were purchased by Mary Anne Shirvani Kintop, 43, of New Freedom, Pa., who pleaded guilty yesterday to conspiracy to commit bank fraud and to making false statements. The Sun reported last year that Kintop had signed mortgages in at least eight different names. Two were variations on the name of a daughter who was 7 when her mother signed the mortgages; another name was that of a daughter who was 8 at the time.
She agreed to a statement of facts that said Schmidbauer, starting in 1984, asked her "to purchase and mortgage homes for him using her own identity and other identities that Schmidbauer would provide. Schmidbauer also provided false supporting documents for the loans such as income and employment verification documents."
He paid her $500 to $700 each time she signed a mortgage, the statement said, adding that "Kintop never saw or lived in any of the properties" and "had no connection to any of the properties after the loan closings."
The mortgages Kintop signed were worth more than $1 million, and lenders have foreclosed on most of them, records show.
Last year, Kintop said in an interview that she had a drug problem, although she said she had been "clean" for two years.
Donna Hart of Baltimore, who signed three mortgages, also pleaded guilty to conspiracy to commit bank fraud and make false statements. The maximum penalty is five years in prison and a fine of $250,000 or twice the loss, whichever is greater.
The other defendants each pleaded guilty to making a false statement. They are: Chester Johnson of North Point and his wife, Sandra Johnson of Odenton, who each bought three houses; and Sharon Sirbaugh and Robert Eshelman, both of Baltimore, two each. The maximum penalty is two years in prison and a fine of $250,000 or twice the loss.
Assistant U.S. Attorney Gregory Welsh asked Nickerson to delay sentencing until completion of the Schmidbauer case.
