Turkeys in the Straw

A mortgage broker who took out astronomical loans on behalf of “straw buyers” has been sentenced to a five-year term in federal prison (“the big house”) for the mortgage fraud scheme.

Viktor Kobzar, a Federal Way mortgage broker, and six other associates charged in the scheme had falsified income documents to obtain loans and then siphoned money prior to attempting to resell the homes.

According to news reports, Kobzar obtained a $1.2 million loan for a house cleaner earning less than $20,000 a year. A janitor earning $16,600 annually had his income falsified to reflect an annual income of $385,000.

Former U.S. Attorney for Seattle Jeffrey Sullivan noted that the banks extending the loans — primarily Washington Mutual and ING Bank — could have prevented the fraud by conducting “a little more due diligence.” (A janitor earning $385K a year? Ya think?)

All six defendants have been tried and sentenced; all but one is serving time in prison (an accountant who falsified income statements got probation and 200 hours of community service).

And what of Washington Mutual and ING? WaMu got eaten by Chase and ING just got gobbled up by Julius Baer Group, Ltd., a private Swiss bank.

And the American taxpayer? Still choking on the leftovers.



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