A federal grand jury has indicted two men for their roles in a large-scale mortgage fraud scheme arising from the fraudulent purchases of more than 40 properties in New Haven. Andrew Constantinou, 57, and Jacques Kelly, 48, were convicted on all counts charged in the indictment following a three week trial before Chief United States District Judge Janet C. Hall. They jury found both men guilty of conspiracy to commit mail fraud, wire fraud, and bank fraud. Kelly was also found guilty of one count of wire fraud and one count of making a false statement to a financial institution.
According to court documents, Constantine, Kelly, and others conspired to defraud mortgage lenders out of millions of dollars by inflating the contract price that property sellers had agreed to accept. The conspirators obtained mortgages from the inflated sale prices and then received thousands of dollars in cash back after closing. These payments were not disclosed to the lenders.
The scheme, which ran from 2006 to 2008, involved multi-family homes in the New Haven area. The majority of the properties purchased have gone into default and since been foreclosed upon. As a result, lenders have lost an estimated $7 million.
Andrew Constantinou, of Farmington, faces a maximum prison sentence of 30 years while Jacques Kelly, of Poughkeepsie, faces up to 80 years in prison. A sentencing hearing has been scheduled for July 14th. Both men are currently out on bail.
This case was investigated by the Federal Bureau of Investigation, the United States Postal Inspection Service, the United States Department of Housing and Urban Development-Office of Inspector General, and the Federal Housing Finance Agency-Office of Inspector General.