X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.
When real estate lawyer Stephanie Hand was hired by Prince Jones Jr. in October to help him buy a house, she had little reason to suspect anything unusual. His information checked out and a mortgage company was ready to lend him $590,000. Yet, a mounting pile of small inconsistencies nagged at Hand and led her to look beyond the paperwork. Her sixth sense paid off, and on Dec. 8, in a sting operation she helped arrange, police arrested Jones (real name: Artis Hunter) and Robin Starr, a woman who was posing as the owner of the house. It turns out that the two may be part of a fraud ring, with connections to South Africa, that preys on mortgage lenders using false identities and warrants of title. Had the scam succeeded, an unsuspecting homeowner would have had his house sold out from under him, and Hand and the other attorneys involved might have been exposed to civil and criminal liability, not to mention consequences to their practice. The case began uneventfully. Jones was referred by phone to Hand by Elaine Silva, of Wall Street Financial in Fairfield, N.J., who regularly sends her clients. Silva had told Hand that Jones specifically asked for her to handle his mortgage, making Silva curious about how he obtained her name. Though Jones told Silva he had a lawyer, Silva convinced him to retain Hand, who she wanted to “check this guy out,” Hand says. Silva was out of the country last week and not reachable for comment. Jones, claiming to be a first-time home buyer, said he planned to purchase a multifamily house at 30-32 Scott Street in Newark and that the owner and resident was a female friend, Zenon Molina, who was selling because she faced foreclosure. Hand says a “huge red flag” went up when Jones called her office and asked her secretary for the name of a title company and surveyor so he could contact them on his own. Hand says she would not expect a first-time home buyer like Jones to know about title searches and surveys. So she asked Jones to come to her East Park Street office in Newark, N.J. Though most clients are eager to meet in person, Jones seemed reluctant, setting off more alarm bells for Hand. Hand had the title report by this point, which showed a mortgage held by “Crestar Mortgage,” but contrary to what Jones had told her, there was no indication of a foreclosure. When Hand asked him about the discrepancy, Jones said Molina was renting to relatives who were not paying their rent and she wanted to sell the building before it got to the point of foreclosure. Jones also told Hand that Molina had no lawyer and asked her if she would handle both sides at the closing. Hand declined but arranged for Steeve Augustin, a lawyer in her building, to represent Molina. Meanwhile, Silva’s firm, Wall Street Financial, verified that Jones had $65,000 in a Wachovia Bank checking account and was employed as an account manager by a securities company in New York. It approved the loan and a closing date was scheduled for Dec. 5. About a week before closing, Silva told Hand she could stop worrying whether Zenon Molina really owned the house: Silva had gone there on some pretext and met a woman who identified herself as Molina’s wife. Wife? Hand clued Silva in on the fact that Molina was supposedly female. “Now, we’re both really suspicious,” recalls Hand. Suspicion grew when a few days before the closing, someone faxed Hand the payoff statement, showing $404,000 in mortgage debt due at closing. It is usually the seller’s attorney who requests the statement, but Augustin had not done so and there was no line on the top showing the number of the sending fax machine. The closing day arrived and Hand and Silva decided to proceed. They had not yet received the mortgage funds so there would still be time to investigate before handing over the money. Augustin, who is also employed in the office of the Essex County counsel, had not met his client Molina prior to the closing. Nor had he ever spoken to her, he says, because she did not return his phone calls. That seemed strange to Augustin, but he was ready to go forward if she had the necessary identification and papers. But when Molina could not provide a forwarding address, Augustin began to have real doubts. He asked her for a driver’s license but she said she didn’t drive and presented a work ID instead. Jones also had no driver’s license, and showed them a Xerox copy, claiming the courts had taken the original. He also produced a work ID, which looked very much like Molina’s — the same size, color, type of plastic, photo placement and notch hole for the neck cord, recalls Hand. But the most discordant note for both Augustin and Hand was Molina’s failure to ask a single question. When lawyers she had never met before told her she would walk away with $147,000 on the $590,000 sales price of her home, she seemed to have no interest in how they arrived at the final number. That ran completely counter to Hand’s experience “ Everybody asks questions,” she says. Once the papers were signed, Molina and Jones were told it would be another day or so before they got the money. Still beset by doubts, Hand and Silva paid a visit that night to Scott Street but the owner was not at home. They met a tenant, however, who spoke Spanish. Hand says that’s when she knew the woman calling herself Molina, who spoke no Spanish, must be lying. They returned about 11:30 that night and when the real Zenon Molina answered the door, Hand told him she had just closed on the sale of his house. Molina knew nothing about it and did not recognize a photo of Jones. Molina told Hand he had gone to his lawyer after receiving mail from Wall Street Financial and was assured there was no problem. Molina could not be reached by phone and Hand declines to name the lawyer, saying he was young and inexperienced and “probably just blew it off.” By this time, Molina had a new lawyer, Brian Keenan, and Hand gave him a call, telling him she was going to have Jones and the woman claiming to be Molina arrested when they came to pick up the mortgage funds. It was “pretty shocking to my client to find out the building he resides in was going to be sold from under him,” says Keenan, of Giantomasi & Oliveira in Newark, who says he advised Molina to cooperate with the investigation. But Hand says the Essex County prosecutor’s office brushed her off and she couldn’t get past the desk officer at Newark police headquarters. So Nathaniel Davis, another lawyer in Hand’s building, called an old friend, Carolyn McIntosh, assistant corporation counsel for the city of Newark. McIntosh, who is assigned to the city police department, got the police to mobilize. When Jones and the woman showed up at Hand’s office on Dec. 8 to pick up the money, the lawyers and Silva stalled them — giving them a copy of the $147,423 check they were waiting for — until police officer Joseph Massenburg Jr. arrived. Augustin had seen the pair arriving and got the license plate number from the parking lot attendant. If they managed to walk away with the money, there would at least be that to identify them, he says. When it was time to confront the pair, Hand felt some trepidation. “I was 98 percent sure, but what if we were wrong?” she says. There was also concern that either of them might be armed. They went into the room together and Hand announced that Massenburg was there because of questions about their identification. Jones said he had no identification and the woman declined to produce any. Massenburg took them in for questioning and they were arrested. Police told Hand that Jones, aka Artis Hunter, said he was part of a ring operating from South Africa. At that point, Hand first learned the identity of Robin Starr and that there was an outstanding warrant for her arrest. Last week, Assistant Essex County Prosecutor H. Rutherford Livengood II, head of the office’s fraud unit, said an investigation was about to start. He did not know if Hunter and Starr were out on bail. He said he sees this type of identity theft crime about three or four times a year and it usually comes to light when an unsuspecting homeowner is hit with a notice of foreclosure. Hand is still savoring a sense of relief that she narrowly avoided facilitating a crime, which, though unwitting, would have had serious financial and professional ramifications. The mortgage company would have come after her for the $590,000 and though her malpractice carrier would likely have paid it, it might have dropped her coverage, leaving her unable to practice. Even worse, if the scam had gone undetected for a while, she might have been used for further deals and wound up “sitting in the prosecutor’s office, explaining how I’m not involved in this ring,” she says. Augustin shares Hand’s sense of a narrow escape, remarking, “We would have had some explaining to do.” As for Davis, the incident “made me realize I don’t want to do real estate any more,” he says. “It’s basically too risky.”

This content has been archived. It is available exclusively through our partner LexisNexis®.

To view this content, please continue to Lexis Advance®.

Not a Lexis Advance® Subscriber? Subscribe Now

Why am I seeing this?

LexisNexis® is now the exclusive third party online distributor of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® customers will be able to access and use ALM's content by subscribing to the LexisNexis® services via Lexis Advance®. This includes content from the National Law Journal®, The American Lawyer®, Law Technology News®, The New York Law Journal® and Corporate Counsel®, as well as ALM's other newspapers, directories, legal treatises, published and unpublished court opinions, and other sources of legal information.

ALM's content plays a significant role in your work and research, and now through this alliance LexisNexis® will bring you access to an even more comprehensive collection of legal content.

For questions call 1-877-256-2472 or contact us at [email protected]

 
 

ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.