Two New Jersey men have been arraigned for their roles in a reverse mortgage scheme that took advantage of elderly homeowners face up to 30-year-prison terms, according to U.S. Attorney Craig Carpenito.
Philip Puccio Jr., 40, of Mahwah, N.J., and Rafael Peralta, 46, of Clifton, N.J., were indicted Feb. 8, 2019, by a federal grand jury on six counts of bank fraud and one count of conspiracy to commit bank fraud. They were arraigned March 15, 2019, before U.S. District Judge Anne E. Thompson in Trenton, N.J., federal court.
Puccio was a loan officer at two mortgage brokerage firms and controlled, or had a financial interest in, and was associated with several home repair and remodeling companies, including Puccio Remodeling. Peralta had a financial interest in and was affiliated with several home repair and remodeling companies, including Puccio Remodeling and a financial services company, ATLAREP Financial Group
Between November 2007 and December 2010, Peralta and Puccio, home repair contractors, allegedly conspired to fraudulently obtain Home Equity Conversion Mortgage--also known as a reverse mortgage--proceeds by submitting inflated and fraudulent documentation to banks to influence their decision to approve and fund reverse mortgages.
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There were six loans involved, valued at $1.6 million and those funds were deposited into Peralta and Puccio's accounts for their personal benefit. In addition to the potential prison terms, the men face a $1 million fine, or twice their gross gain, or twice the gross loss to others, whichever is greater.
Peralta and Puccio recruited a conspirator to prepare inflated real estate appraisals that falsely increased the value of the properties securing the HECMs, thereby influencing the lender’s decision to provide loans in amounts greater than what would otherwise be available.
Also, they caused the submission of false and fraudulent loan documents that actively concealed the disbursement of loan proceeds to Peralta, Puccio, and entities they owned and controlled. The diverted loan proceeds were deposited into bank accounts of the two contractors and was used for their personal benefit and to further the conspiracy.
A co-conspirator who wasn’t named as a defendant is an attorney who conducted the closings of real estate transactions and resided in Montville, N.J., and Joseph Soprano, a co-conspirator who also wasn’t named as a defendant, but was an unlicensed real-estate appraiser who resided in New Jersey.
