Burnsville Man Guilty in $43M Mortgage Fraud
Troy Chaika was found guilty on Tuesday to charges related to a mortgage fraud scheme that bilked lenders out of more than $43 million, according to Minnesota's U.S. Attorney's office.
Chaika, a 44-year-old man from Burnsville, was found guilty of seven counts of wire fraud, three counts of mail fraud, and one count of conspiracy to commit wire fraud and mail fraud. He was indicted for his crimes last April.
Between 2005 and 2008, Chaika allegedly worked with others-including Dustin LaFavre, who pleaded guilty in 2009 and awaits sentencing-to make money off of more than 100 residential property deals.
Chaika and LaFavre allegedly negotiated with sellers to buy properties, often at greatly reduced prices. They then resold the properties by telling buyers that they would receive “kickbacks” from lenders' funds. The two men lied to buyers by telling them that they bought the properties at much higher prices.
Because of the higher prices they charged, Chaika and LaFavre had enough money to pay kickbacks to buyers and keep money for themselves. They often lied about the actual sale prices on purchase agreements and other documents, including those used in the mortgage application process. They also loaned money to buyers for down payments while their applications were still pending.
Chaika faces up to 20 years in prison for each count that he faces. His sentence will be determined at a future hearing.