Indian American Surjit Singh, 72, of Dublin, California and his son Rajeshwar Singh, 44, of Pleasanton, California, were sentenced to 11 years and three months in prison on four counts of mail fraud, four counts of bank fraud, and four counts of false statements on loan and credit applications, according to a Department of justice press release.
In addition, Anita Sharma, 56, of Gilroy, California was sentenced to three years and 10 months in prison on two counts of mail fraud, two counts of bank fraud, and two counts of false statements on loan and credit applications.
Altogether, they are charged with procuring more than $9.3 million in residential mortgage loans.
While Surjit was ordered to pay a $2 million fine, $698,787 in restitution, and $847,000 in forfeiture, Rajeshwar was ordered to pay a $1 million fine, $928,287 in restitution, and $838,399 in forfeiture and Sharma was ordered to pay $603,180 in restitution and $30,000 in forfeiture, according to a press release.
According to court documents, in 2006 and 2007, Surjit recruited individuals with good credit to act as straw buyers for residential properties owned by his family members and associates.
Rajeshwar, being a licensed real estate agent, assisted in the scheme by submitting loan applications for the straw buyers and Sharma, a dental assistant at the time, was one of the straw buyers.
Because Sharma and the other straw buyers could not afford the homes based on their true incomes, the Singhs submitted fraudulent loan applications and supporting material to lending institutions that included false statements about the straw buyers’ income, employment, liabilities, and intent to occupy the homes as their primary residences.
According to a Department of Justice press release, at least 14 properties were involved in the scheme, where Sharma herself purchased five homes in San Jose, San Ramon, Elk Grove, Sacramento, and Modesto, while other straw buyers purchased or refinanced properties in Stockton, Modesto, Patterson, Lathrop and Tracy.
All of these homes were ultimately either foreclosed upon or sold in a short sale where the bank lets homeowners sell their homes for less than is owed on the mortgage.
Sharma was then paid for her involvement in the scheme and Rajeshwar received financial benefits through broker commissions for the transactions and as the seller of seven of the properties.
He also continued to occupy the San Ramon property at a time when Sharma should have been living there.
Surjit benefitted through payments out of escrow directed to shell companies, such as SJR Investments and BK Investments, which were associated with his daughter and significant other, and were purportedly for contracting services, which did not occur.
He also benefitted through rental payments made to him and his significant other by the renters of the homes, as the straw buyers were not living in the homes.
In addition, many of his family members received money by selling properties and had money directed to them out of escrow.
While Surjit is in custody, Rajeshwar and Sharma are scheduled to self‑surrender on January 9, 2019.