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Josh Goldberg charged with mortgage fraud

January 22, 2013

A federal grand jury indicted mortgage broker Joshua S. Goldberg today, alleging he helped steal $2.5 million from various lenders through a mortgage fraud scheme in Baltimore. City Paper first outlined the scheme in this 2008 story.

As the financial crisis worsened Goldberg and his husband, Bayardo Alvarez, continued to get big mortgages and not pay them back, apparently applied for a federal loan modification and, in the summer of 2011, emigrated to Israel, where they became a big deal in gay rights circles.  Alvarez’s citizenship was eventually confirmed under Israel’s “right of return” law, which does not always recognize gay, non-jewish spouses.

According to the indictment Goldberg, operating what he called a “boutique” mortgage brokerage called Worthington Mortgage Group in Upper Fells Point, conspired with neighbor Kenneth Koehler, appraiser David Christian and several others obtain loans that they would never pay back.

The indictment says Goldberg committed wire fraud by way of false and misleading appraisals, false HUD-1s (that’s the ur-document in mortgage lending), “fictitious employment information and false monthly income figures, which resulted in multiple loan defaults, foreclosures and losses to mortgage lending companies and financial institutions in excess of $2.5 million.”

According to the indictment, Goldberg helped “co-conspirators A and B”—these would be  George and Emmanuel Agelakis,  brothers who sources indicate have since moved to Canada—scam the lenders by ordering David Christian to submit bogus appraisals, using interior photos of different homes and claiming shitty shells were already renovated.

Goldberg and Ken Koehler were co-founders in Voicebank, a tech outsource company that stopped operating around 2000 but was allegedly used to create false employment records for various borrowers, the indictment says.

According to the indictment, which is a statement of charges and in no way implies guilt, Koehler sold two houses to George Agelakis and one to his brother, Emmanuel, and “concealed from lenders the true purchase price” by claiming to have received earnest money from the brothers that he never actually got. Koehler then kicked-back “a substantial part of the proceeds from each purchase back to the co-conspirators,” the indictment alleges, “thereby further reducing the actual sales price of each property.”

Banks, of course, like to think they’re lending way less than a house is worth, not two or three times more. When they lend way more, borrowers tend to just walk away with the money.

A press release from U.S. Attorney Rod Rosenstein’s office says the prosecution is part of the Maryland Mortgage Fraud Task Force, which in-turn is part of a national Financial Fraud Enforcement Task Force. “Goldberg faces a maximum sentence of 30 years in prison and a fine of $1 million for the conspiracy and for wire fraud affecting a financial institution,” the release says, adding: “Goldberg is believed to be a fugitive.”

If Goldberg and Alvarez are in Israel that may complicate his prosecution. Israel does not easily allow extradition of its citizens for trial in other nations—a fact that turned the prosecution of boy-murderer Samuel Sheinbein into an international legal funfest in the late 1990s. Sheinbein eventually was tried and convicted in Israel, receiving a 24-year sentence. Asked what the next steps are in Goldberg’s case, U.S. Attorney Office spokeswoman Marcia Murphy emailed: “At this point we are continuing to investigate and will attempt to locate him.”

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