A disbarred lawyer-turned mortgage broker has pleaded guilty to stealing nearly $5 million in refinancing loans, using it to buy dozens of watches and piles of jewelry, instead of paying off his clients’ original mortgages.
Brent Kaufman, 50, of Commack, N.Y., admitted that on numerous occasions between 2016 and 2019, he listed his own bank account number on paperwork submitted to new lenders informing them where to send the money.
Typically, the money would be wired to the homeowner’s original lender to pay off their existing loan. As a result, Kaufman’s clients were unknowingly left with two mortgages on their homes. In several cases, the financial institutions involved moved to foreclose on the innocent borrowers, although no one ultimately lost their home, a person familiar with the matter said.
“This is a classic case of greed overcoming honest business practices, as Mr. Kaufman took advantage of his access to clients’ funds to enrich his own lifestyle,” said Darnell Edwards of the United States Postal Inspection Service. “His actions left many in financial ruin, holding two mortgages and facing the threat of foreclosure.”
Prosecutors say Kaufman had been working as a mortgage broker even though he had no license. Kaufman faces up to 30 years in prison as well as $1 million in fines. Prosecutors have also moved to have the dozens of watches and pieces of jewelry seized from Kaufman’s home forfeited to the government.
In an email, Kaufman’s attorney said his client “regrets his role in the offense,” and “looks forward to moving on to the next chapter in his life.”
According to civil lawsuits filed by several of the lenders who were defrauded in the case, Kaufman’s clients appeared to be mostly new immigrants with homes in Long Island and Queens.
In some cases, Kaufman would use some of the $4.7 million he had pocketed to continue making mortgage payments on the homeowners’ original loans, or even pay them off, to avoid detection, prosecutors said. In all, prosecutors say Kaufman kept approximately $2.5 million for himself.
Once a lawyer, Kaufman was sentenced to 18 months in prison and disbarred in 2000 for his role in a bankruptcy fraud case, records show.
This post was originally published on Market Watch
