Insights Into Mortgage

Fraud
A Continuing Education Class For
Real Estate Professionals

500 Pearl Street

P.O. Box 146
Manchester, MA 01944

Insights Into Mortgage Fraud

BRINGING REAL CASES TO
TRAINING
Joseph Petrucelli brings extensive
research and 30 years of experience
to the development of this interactive
case study based on mortgage fraud.
As a former NJ Real Estate
commissioner, he was amazed at how
many people had not realized they
had even perpetrated a fraud. Upon
digging deeper, he found that good
smart and well intentioned people
were putting themselves in bad
ethical/legal situations. It is through
those insights that we have created
this class. The purpose of this case
study is to create an awareness of
fraud so that professionals are aware
of the traits of mortgage fraud and
speak when they see them.

MORTGAGE FRAUD
We do not have to go far back in
history to understand mortgage fraud
beyond the financial crisis of 2008. At
its epicenter were mortgage
transactions that were overvalued,
misrepresented and fraudulently
obtained. It was a virtual Wild West
of loan products fueled by aggressive
sales and little oversight by regulatory
bodies. However, as the crisis
reached its peak, authorities looked
back through documents and what
they found would lead to the
indictment of thousands of individuals
across the country.
We have developed a case study that
sheds some light on the aftermath of
mortgage fraud and what it was like
from the perspective of two people
who got caught up in a federal
criminal case.

A WINNING REALTOR AND A

TOP TITLE INSURANCE
LAWYER
Holly Pasut was a million-dollar and
award winning real estate agent in
Charlotte, NC. What she did not
realize was that one of her business
associates would become deeply
involved in mortgage fraud. She
would become a co-conspirator in
one of the largest morgage fraud
investigations in the U.S., Operation
Wax House. Holly was indicted in
2012, pleaded guilty and was
sentenced to 24 months in federal
prison. Her talks provide insights into
how she trusted someone without fully
understanding her role in his real
estate transactions.
Rashmi Airan was named Kent
Scholar for achieving highest
academic honors at Columbia Law
School. After working on Wall Street
at Morgan Stanley, she ran a
successful title insurance firm in
Miami, FL. She too partnered with
associates who were breaking the
law, leading to her own indictment on
mortgage fraud. Rashmi would plead
guilty, cooperate against others by
testifying in federal court and was
sentenced to a year in prison.
In two unrelated cases, these two
women would spend time in prison
and now are sharing their story with
other professionals through our case
study approach. With Joe acting as
moderator, we bring these stories to
life and put you in the front row so that
you can see how cases like this are
prosecuted.

500
PEARL STREET

Joseph Petrucelli
CPA, CFE
Co-Author of
Preventing Fraud
and Mismanagement
in Government
(Wiley 2016)
What we are doing
here is taking
presentations to a
new level by showing
audiences real
people and real
situations involving
fraud.

Insights Into Mortgage Fraud

500
PEARL STREET
DESCRIPTION
This 3-hour ethics-driven class presents two separate cases
involving bank/mortgage fraud charges. One is a successful real
estate agent and the other a top-rated real estate attorney. Both
would end up pleading guilty to federal crimes and, as you will
see, both suffered consequences due to the risks they were
taking, largely due to mounting pressures around them, and by
associating with people who were bent on financial mischief.
CORE OBJECTIVES
1) Understand the importance of Professional Skepticism
2) Understand different levels of Knowing and how willful
blindness can lead to corruption
3) Understand responsibilities of those involved in real estate
transactions
4) Understand the role of the real estate agent and title insurance
lawyer
5) Understanding the Importance of Trust and its role in enabling
fraud
6) Understand the distractions that allow fraudulent schemes to
occur
7) Understand the opportunities and environments that exist that
allow fraud to occur despite existing controls
8) Understand how fraudsters use deception and separation to
perpetrate their acts
9) Understand how fraudsters gain access to value and convert
it into a personal monetary gain.
10) Understand how to conduct adequate follow-up on important
issues
11) Understand the behaviors surrounding fraudulent schemes

Rashmi Airan
Former Title
Insurance Attorney
When that one big
deal came my way, it
closed my eyes to
the bigger picture of
what was really
happening.

Course Outline

DEFINITION OF FRAUD

500
PEARL STREET

ELEMENTS OF FRAUD
TYPES OF FRAUD INVOLVING REAL ESTATE
CASE STUDY KEY ELEMENTS
CASE STUDY PRESENTATION (HOLLY)

A Successful Real Estate Agent

The Hot Market In North Carolina
An Opportunity and Referral Fee
As The Bubble Bursts - Feeling Something Was Wrong
Trying To Do The Right Thing
Up To My Neck In Trouble
Critical Thinking Errors
Conspiracy vs Intent

CASE STUDY KEY ELEMENT REVIEW

CASE STUDY PRESENTATION (RASHMI)

Accomplished Real Estate Attorney

Meeting With Developer - That Client You Wish For
Not Wanting To Ask Tough Questions
The FBI And Prosecutors Get Involved
The Painful Decision
Pleading Guilty And Cooperation

CASE STUDY KEY ELEMENT REVIEW

PROFESSIONAL SKEPTICISM

Due Care
Lack of Sufficient Evidence
Mindset
Illusion of Objectivity and Transparency
Attribute Trust
Rational v Irrational Behavior

Holly Pasut
Former Real Estate
Agent

If I would have
understood the
risks I faced, I
would have turned
the other way.
Things would have
turned out so much
different.

500
PEARL STREET

Contact information
WE WANT TO HEAR FROM YOU
If you have question about this presentations or one of
the many others that we have in our library, please send
us an email at info@500PearlStreet.com or call us at
617-858-5008.
Visit our website at www.500PearlStreet.com

500 Pearl Street

P.O. Box 146
Manchester, MA 01944

Bringing real cases

to life for audiences
that are engaging,
fun and
memorable.