Attorney General Christopher S. Porrino announced that a lawyer from Passaic County was sentenced to state prison today for conspiring to steal just over $800,000 from lenders by using stolen or fictitious identities to file fraudulent mortgage loan applications for two real estate transactions, falsifying settlement statements and diverting loan proceeds.
Michael Palmer, 57, of Clifton, who formerly had a law office on Hoover Avenue in Passaic, was sentenced to four years in state prison by Superior Court Judge Scott J. Moynihan in Union County.
Palmer pleaded guilty on March 14 to a single second-degree charge of conspiracy to commit theft by deception and money laundering.
Palmer is required to pay full restitution for any losses not previously recovered by the victim lenders, and he also must forfeit his license to practice law in New Jersey.
In pleading guilty, Palmer admitted that he defrauded lenders in connection with two mortgage loans: a loan for $481,903 for a residential property on Fulton Street in Elizabeth, and a loan for $319,113 for a residential property on Paulison Avenue in Passaic.
Palmer conspired with other defendants in the two fraudulent real estate sales that induced the lenders to make the loans. In each case, there was a property seller who was a co-conspirator, while no actual buyer existed. For the Passaic property, the purported buyer was a man who lives in Puerto Rico and whose identity was stolen. For the Elizabeth property, the buyer also is believed to be a man living outside of the U.S. whose identity was stolen. The defendants provided false information and documents with the loan applications, including employment records, bank statements and tax documents. Palmer was the closing attorney and settlement agent for both closings. He filed false settlement statements and forms indicating that he had established the identity of the parties, that the buyers/borrowers made required payments, and that the loan proceeds were properly disbursed. In reality, the transactions were fraudulent and loan proceeds were improperly diverted for the benefit of the defendants. Only minimal payments were made on each of the loans.
Palmer was charged in two separate indictments, one for each of the fraudulent mortgage loan transactions.
With respect to the $312,978 loan for the Passaic property, Palmer was indicted in 2014 along with Julio Concepcion, 51, of Passaic, who was the property owner and seller in the sham transaction. Concepcion pleaded guilty in October 2015 to second-degree conspiracy in connection with that indictment.
He faces a recommended sentence of five years in state prison. He also pleaded guilty that same month in Essex County to first-degree conspiracy in connection with another mortgage fraud indictment obtained by the Division of Criminal Justice.
The state will recommend a 10-year prison sentence in that case, with the two sentences to run concurrently. Concepcion is awaiting sentencing.
With respect to the $481,903 loan for the Elizabeth property, Palmer was indicted in 2013, along with the following defendants:
Ivan Angeles, 41, of Garfield, who conspired in the fraud as a loan officer for the victim lender, pleaded guilty to second-degree conspiracy and was sentenced on June 24 to three years in state prison; and
Humberto Hidalgo, 42, of Wesley Chapel, Fla., who was a seller of the property, pleaded guilty to second-degree conspiracy and was sentenced on April 29 to a term of three years of probation, which took into account jail time already served.
Attorney General Porrino and Director Honig noted that the Division of Criminal Justice has established a toll-free tip line 1-866-TIPS-4CJ for the public to report corruption, financial crime and other illegal activities.
MAdditionally, the public can log on to the Division of Criminal Justice webpage at www.njdcj.org to report suspected wrongdoing. All information received through the tip line or webpage will remain confidential.
Defense Attorney: Paul Brickfield, Esq., Brickfield & Donahue, River Edge