Boston developer Michael David Scott, owner of Southeast Properties, has been indicted on federal fraud charges with regards to a real estate scheme that left countless abandoned properties in city neighborhoods. The Boston Globe reports that Michael David Scott was indicted on 62 counts of wire fraud, bank fraud, and money laundering. He is accused of fraudulently enabling borrowers, many of whom were low income, to borrow hundreds of thousands of dollars in order to buy condos in Roxbury and Dorchester.
U.S. Attorney Carmen M. Ortiz claims that the developer's plan not only cheated lenders and borrowers, but it also caused trouble for the communities involved. She released a statement that read: "Frauds of this kind line the pockets of unscrupulous schemers at the expense not only of mortgage lenders, but of so many homeowners who saw property values in whole neighborhoods decimated." Scott allegedly falsified important information on buyers' applications to mortgage lenders such as income, assets, down payment, and residence.
While it is wise to speak to a knowledgeable Boston real estate attorney before you consider purchasing any piece of real estate, it seems like a lot of buyers involved in this case did not. Scott's victims claimed that they were promised easy rental money that would cover mortgage costs. Victims signed blank mortgage applications and legal documents that would allow Scott and his associates to purchase property on their behalf.
Now many of these victims are left with bad deals. Some of the properties have gone into foreclosure, some have been shuttered due to health and safety violations, etc. Scott is due to appear in U.S. District Court in Boston on September 13.
Related Resources:
- Boston Condo Market Makes a Comeback (FindLaw's Boston Real Estate Law News Blog)
- Find A Boston Real Estate Attorney (FindLaw)
- Condo Sales On The Rise: What Is A Condo? (FindLaw's Boston Real Estate Law News Blog)
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