4 MN Men Charged In Alleged Mortgage Fraud Scheme
Four Minnesota men were charged Wednesday by a federal grand jury in connection with a mortgage fraud investigation that resulted in eight counts of wire fraud and one count of conspiracy to commit wire fraud.
The U.S. Attorney’s Office announced Thursday that the four defendants allegedly participated in a scheme to defraud mortgage lenders in the sale of “unsold builder inventories of residential real estate.”
The four men are Thomas Rosensteel III, from Excelsior; Robert Aslesen, from Little Canada; Justin Christenson, from East Bethel; and Dale Wurzinger, from Burnsville.
The men are accused of recruiting individuals to buy properties at inflated prices, including properties in Otsego, Maple Lake, Big Lake, Ramsey, and Plymouth. The men then allegedly falsified loan applications and other documents, fronted down payments for purchasers, and paid kickbacks to the purchasers outside of closing the deals.
Rosensteel owned and controlled Excelsior-based Split Rock Realty and Split Rock Properties and Christenson and Wurzinger worked for Rosensteel at Split Rock Realty as real estate salesmen.
Aslesen owned and controlled Options Plus Reality, Inc., which the U.S. Attorney’s Office said was used as a conduit through which excess loan proceeds were returned to buyers. Options Plus was allegedly receiving kickbacks ranging from $25,000 to $70,000 per transaction.
The four men allegedly conducted eight wire transfers that totaled just over $2 million from January 31, 2007 to October 12, 2007. If convicted, each of the four defendants faces a potential maximum penalty of 30 years in prison on each count. A federal district court judge would ultimately determine each sentence, if the men are found guilty.
“The allegations in this indictment illustrate a sophisticated scheme carried out by licensed professionals in the real estate industry,” U.S. Attorney Andrew Luger said in a statement. “We have been working closely with the FBI and the Minnesota Department of Commerce Fraud Bureau to bring charges against these four individuals who used their knowledge and position to take advantage of the system.”
Three other individuals have already pleaded guilty to criminal charges in connection with this scheme and are awaiting sentencing. They are Amri Elsafy from Brooklyn Park; Gerald Edwin Carlson from Kennedy; and James Bryan Crook from Brooklyn, New York.
In 2011, Michael Hyland, a real estate broker for Split Rock Realty, was charged in a civil suit for his involvement with the fraud scheme. Although Hyland wasn’t mentioned in the most recent indictment, it did reference “others known and unknown to the grand jury” as aiding and abetting the four men in the mortgage scheme.