Four Indicted In Md. Mortgage Fraud Scheme

April 28, 2009|By Paul West | Paul West,

State and federal authorities announced criminal indictments Monday in an alleged $70 million mortgage fraud scheme that ensnared more than 1,000 homeowners, most of them from Maryland.

Assistant U.S. Attorney General Lanny A. Breuer said charges had been brought against four people in connection with the alleged Ponzi scheme, including Andrew H. Williams Jr., who was enjoined by Maryland authorities in 2007 when they froze his Metro Dream Homes operation.

The victims of the alleged scheme were persuaded to invest $50,000 or more to refinance their homes or buy new ones under a program that promised to pay off their mortgages within five to seven years. Investors were told their money would go into the Laurel-based company's ventures in automated teller machines, flat-screen TV advertising and electronic "Touch-N-Buy" kiosks, ventures said to be nonexistent.

A federal indictment unsealed Monday in federal District Court in Baltimore said Williams and the other defendants used those investments to pay for luxury trips to the 2007 NBA All-Star Game and the 2007 Super Bowl, a fleet of chauffeur-driven luxury cars and salaries of up to $200,000 for their employees.

Breuer said that "rampant financial fraud" has contributed to rising foreclosures.

The indictment said the alleged scheme operated between 2005 and 2007. Most victims lived in Prince George's County, according to Maryland Attorney General Douglas F. Gansler. Indictments were brought against Williams, 58, of Hollywood, Fla., the founder and owner of Metro Dream Homes, as well as Michael A. Hickson, 46, of Commack, N.Y., the chief financial officer; Isaac J. Smith, 46, of Spotsylvania, Va., the president; and Alvita K. Gunn, 31, of Hanover, Md., a vice president who had an initial appearance Monday in U.S. District Court in Greenbelt.

A criminal information was returned against Carole Nelson, 50, of Washington, the alleged chief financial officer of POS Dream Homes, on a money-laundering count.

Attorneys in the case could not be reached.

The Associated Press contributed to this article.

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