Lawyer Sentenced to Prison for Obtaining $2.6 Million in Home Loans Through Fraudulent Applications
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Lawyer Sentenced to Prison for Obtaining $2.6 Million in Home Loans Through Fraudulent Applications

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TRENTON – September 19, 2012 – (RealEstateRama) — Attorney General Jeffrey S. Chiesa announced that a lawyer from Monmouth County was sentenced to prison today for his role in a scheme to steal more than $2.6 million from lenders by filing fraudulent mortgage loan applications.

The lawyer, Mark J. Bellotti, 56, of Marlboro, was sentenced to five years in prison by Superior Court Judge Anthony J. Mellaci Jr. in Monmouth County. He was also ordered to pay a fine of $50,000. Bellotti pleaded guilty on Feb. 21 to second-degree charges of conspiracy and theft by deception. His license to practice law in New Jersey has been revoked as a result of the charges.

Previously, an investment broker who was involved in the conspiracy, Jonathan P. Domash, 42, of Marlboro, owner of Diversified Assets, LLC, was sentenced to three years of probation by Judge Mellaci. He pleaded guilty on Feb. 21 to a charge of third-degree theft by deception.

Bellotti and Domash admitted that they conspired to falsify mortgage loan applications to cause banks to provide loans to unqualified home buyers. The two men were charged in an April 11, 2011 state grand jury indictment stemming from an investigation by the Division of Criminal Justice Financial & Computer Crimes Bureau. Deputy Attorney General Valerie A. Noto prosecuted the defendants and handled today’s sentencing for the Division of Criminal Justice.

“Lawyers take an oath to uphold the law, but this one repeatedly betrayed his oath and broke the law to turn a quick profit,” said Attorney General Chiesa. “We’re aggressively investigating and prosecuting this type of mortgage fraud.”

“This lawyer and his co-conspirators falsified mortgage applications so they could siphon away big closing fees, while leaving behind a trail of foreclosed properties and borrowers with ruined credit,” said Director Stephen J. Taylor of the Division of Criminal Justice. “We urge people to contact us confidentially to report lawyers and other licensed professionals who commit fraud.”

The indictment charged Bellotti and Domash in connection with seven mortgage loans totaling $2,671,400. A third defendant named in the indictment, Leonardo A. Hernandez, 41, of Hillsborough, pleaded guilty on Feb. 21 to an amended count of the indictment charging theft by deception as a disorderly persons offense. He admitted that he submitted false information and documents in connection with several of the loans. Hernandez faces a sentence of probation.

Charges remain pending against three other individuals who were charged in the indictment for allegedly assisting Bellotti and Domash.

The investigation revealed that Domash, Bellotti and Hernandez falsified information about employment, earnings and bank account balances on mortgage loan applications so that home buyers could obtain loans for which they were not qualified. They also falsified U.S. Department of Housing and Urban Development (HUD) settlement forms.

The defendants submitted fraudulent loan applications and HUD documents between April 2006 and June 2007 to obtain mortgage loans in the following amounts for seven homes in these locations: Hillsborough ($540,000), Plainfield ($342,000), Marlboro ($339,150), Keansburg ($351,500), Asbury Park ($384,750), Asbury Park ($374,000), and Newark ($340,000).

The investigation revealed that Domash would find homeowners who were eager to sell, and then convince buyers to invest in the homes as income properties through his company, Diversified Assets, LLC. He had buyers sign blank loan applications, so he and other defendants could falsify the buyers’ personal financial information. Bellotti handled the closings for the home sales, performing separate closings with the buyers and sellers. The defendants inflated the sales prices for the properties and took out huge fees at closing from the loan proceeds. All of the homes ultimately fell into foreclosure, and some purchasers had their credit ruined.

Deputy Attorney General Noto presented the case to the state grand jury. The investigation was conducted and coordinated for the Division of Criminal Justice Financial & Computer Crimes Bureau by Detective Kimberly Allen, Deputy Attorney General Noto, and Supervising Deputy Attorney General Terrence Hull, Chief of the Financial & Computer Crimes Bureau.

Attorney General Chiesa and Director Taylor noted that the Division of Criminal Justice has established a toll-free tipline 1-866-TIPS-4CJ for the public to report corruption, financial fraud and other illegal activities. Additionally, the public can log on to the Division of Criminal Justice Web site at www.njdcj.org to report suspected wrongdoing. All information received through the Division of Criminal Justice tipline or Web page will remain confidential.

Media Inquiries-
Peter Aseltine
609-292-4791

Citizen Inquiries-
609-984-5828

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