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North Carolina Partners with Federal Agencies in Builder Fraud Case; Nets $50 Million National Settlement

(The following is excerpted from ARELLO® Boundaries, the newsletter to members of the Association of Real Estate License Law Officials.)

The North Carolina Real Estate Commission recently joined numerous federal agencies and the state’s Commissioner of Banks in announcing the resolution of an inter-agency investigation of Beazer Homes, a home building company based inAtlanta, Georgia, with operations in at least 21 states, and its wholly-owned subsidiary, Beazer Mortgage Corporation.

In a criminal Bill of Information filed along with a Deferred Prosecution Agreement resolving the case, the United States Attorney for the Western District of North Carolina (Charlotte Division) charged the company with engaging in massive and complicated schemes that included discount point fraud, down payment assistance fraud, HUD-licensing fraud and mortgage loan stated-income fraud.

In the Deferred Prosecution Agreement executed by the United States Attorney and Beazer, the company agreed to pay up to $50 million dollars in restitution over several years.

The announcement of the investigation and resolution of the case included public statements by officials of the many agencies involved in the investigation including U.S. Attorney Edward R. Ryan, HUD Secretary Shaun Donovan, the North Carolina Deputy Commissioner of Banks and North Carolina Real Estate Commission Deputy Chief Counsel Janet Thoren.

Thoren said, “The North Carolina Real Estate Commission is committed to the fight against mortgage fraud. We are pleased that we were able to partner with the U.S. Attorney’s Office in the Western District and each of the other agencies involved in this complicated and detailed investigation and work together to bring about a result that includes restitution to so many consumer victims, both in North Carolina and nationwide.”

This article came from the October 2009-Vol40-2 edition of the bulletin.