WASHINGTON, D.C. – January 15, 2013 – (RealEstateRama) — On Friday, January 10, 2014, a Fulton County Grand Jury indicted Edmund Chatham, of Roswell, Ga., and Steven Connelly, of Alpharetta, Ga., on one count of Racketeering (O.C.G.A. §16-14-4(a)) for their role in a scheme using senior citizens to fraudulently obtain payouts from mortgage lenders for reverse mortgages.
Reverse mortgages allow homeowners to borrow a percentage of the equity they have accumulated in their homes while still being allowed to remain in the homes. The loans become due when the homeowners no longer occupy the homes, at which point the lender can sell the property to recover the loan. Senior citizens aged 62 and over may be eligible to obtain a reverse mortgage through the Home Equity Conversion Mortgage (HECM) program, which is administered by the U.S. Department of Housing and Urban Development (HUD). These loans are federally-insured and guarantee that the lenders make their obligations.
Racketeering is punishable by five to twenty years imprisonment and/or a fine of up to $100,000 or three times the pecuniary value gained by each defendant.
Assistant Attorney General Greg Lohmeier is prosecuting this case on behalf of the State of Georgia. The case was investigated by HUD Agents Gustaveous Madden and Tyrone Hardy.