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In the following To view links in this forum your post count must be 10 or greater. Your post count is 0 momentarily. Frank J. Magill, United States Attorney for the To view links in this forum your post count must be 10 or greater. Your post count is 0 momentarily. announced that a 28-year-old St. Paul man pleaded guilty yesterday in federal court to participating in a scheme to defraud mortgage lenders out of more than $389,000 in concealed payments. Daniel Michael Doocy pleaded guilty to one count of wire fraud and one count of money laundering [To view links in this forum your post count must be 10 or greater. Your post count is 0 momentarily.]. He entered his plea Jan. 15 in St. Paul before United States District Court Judge Donovan Frank. Doocy was charged on Dec. 10, 2008.
According to Doocy’s plea agreement [Ed. note yet available on PACER], he admitted that from November 2005 through January 2007 he, along with others, devised and intended to devise a scheme to defraud and to obtain money by means of false and fraudulent pretenses. Doocy was a loan officer at two mortgage brokerage companies, and while acting as a loan officer, he participated in a scheme whereby concealed payments from mortgage loan proceeds were diverted to buyers of real properties and others through the use of fraudulent underwriting and closing documentation.

As a loan officer, Doocy admitted that he caused fraudulent loan application documentation to be provided to potential lenders for purposes of loan underwriting, which misrepresented the true terms of the proposed transaction. Among other things, the documentation falsely overstated the true purchase price to be paid by a buyer for a real property, falsely overstated the income from the borrowers, falsely stated that the residences were to be owner-occupied, and concealed payments that were to be made from the loan proceeds to the buyer and others, including Doocy.
Based on the fraudulent documentation, the proposed loans were approved, and the loan proceeds were disbursed by the lender to a title company. Doocy would then work with a closing agent to execute the fraudulent scheme by disbursing the funds in a manner other than what was understood by the lender, specifically, making concealed payments to the buyer and others, including Doocy.

For every transaction, Doocy and his company received substantial fees for arranging the fraudulent transactions, in addition to the concealed payments. Doocy admitted participating in approximately 10 separate real estate transactions worth approximately $4 million in total loan proceeds. There was at least $389,000 in fraudulent, concealed payments made during those transactions.

In June 2006, in order to effect the scheme, Doocy admitted wire transferring a false loan application form in connection with the purchase of a Prior Lake residence. Doocy also admitted that on May 3, 2006, he knowingly obtained $31,000 in illegal excess payments in connection with a mortgage loan obtained for the purchase of a St. Paul residence.

Doocy faces a potential maximum penalty of 20 years in prison on the wire fraud count and 10 years on the money laundering count. Judge Frank will determine Doocy’s sentence at a future date. This case is the result of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation Division and is being prosecuted by Assistant U.S. Attorney Timothy Rank.


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