The founder and president of a defunct Massachusetts mortgage company pleaded guilty this week to defrauding Ginnie Mae out of approximately $2.5 million.
According to the U.S. Attorney’s Office for the District of Massachusetts, Robert Pena pleaded guilty on Wednesday to one count of conspiracy and six counts of wire fraud.
Pena was the founder and president of Mortgage Security Inc., a shuttered mortgage company that was based in Falmouth, Massachusetts.
Mortgage Security Inc. was contracted with Ginnie Mae to pool eligible residential mortgage loans and then sell Ginnie Mae-backed mortgage bonds to investors. MSI serviced the loans in question, and that’s where the issue stemmed from.
According to court documents, beginning in 2011, Pena allegedly began diverting money that borrowers sent to MSI into private bank accounts, which he then used to pay for personal and business expenses.
Specifically, Pena allegedly deposited “high-dollar, loan-payoff checks” into bank accounts he controlled. Pena also allegedly took borrowers’ escrow funds and mortgage-insurance premiums for his personal use.
As a Ginnie Mae servicer, MSI was required to provide the agency with regular reports about the status of the mortgages in the pools, but Pena attempted to cover up his scheme by providing Ginnie Mae with false reports concerning the mortgages in question.
In total, Pena misappropriated approximately $2.5 million, which Ginnie Mae had to pay to the investors whose investments it had guaranteed.
According to the U.S. Attorney’s Office, the charging guidelines stipulate a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000 or twice the gross gain or loss.
Pena’s sentencing is scheduled for Jan. 5, 2018.
