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Birmingham-based Regions' Miami employees indicted in mortgage fraud

BIRMINGHAM, Alabama -- A Regions Bank branch manager and 19 others have been accused by federal prosecutors of operating a $40 million mortgage fraud scheme in Miami.

Ivette Carreno was instrumental in getting fraudulent loans approved, according to an indictment filed this week in U.S. District Court in South Florida. She and the others face 30 years in prison on each count they face.

Birmingham-based Regions Financial Corp., the largest bank based in Alabama, first discovered the fraud and reported it to authorities, spokeswoman Evelyn Mitchell said. The company wasn't accused of any wrongdoing.

The company declined to comment on what percentage it is exposed to of the $20 million in bank losses stemming from the fraudulent and uncollectable loans. Other lenders mentioned in the indictment who are not defendants are IndyMac Bank, Flagstar Bank, Washington Mutual Bank and HSBC Mortgage Corp.

The fraud was notable, the indictment indicated, by its length and scope. Prosecutors said it ran from 2006 to 2008 and secured about 200 home equity lines of credit under false pretenses, the proceeds of which were shared among the almost two dozen participants.

Note also the depth of participation among the people in need of conspiracy in almost all facets of the real estate industry. The accused may be Carreno banker, mortgage brokers, title agent, an appraiser and home of several sales representatives.

"Even by the standards of South Florida for fraud, the prosecution today is shocking," said prosecutors in a statement. "Never before have we seen so many real estate and banking professionals charged in one indictment. "

Otherwise, the fraud was simple, prosecutors said. Properties were identified for purchase and people were recruited to file mortgage applications that included phony income, employment and credit-history information.

The cooperation of appraisers and mortgage originators was purchased with bribes. Bank manager Carreno was paid to see that the loan applications were approved, applications in some cases for credit lines on properties not even owned by the applicants.

The sky is falling! Will my insurance ... - Florida Insurance Law Blog

Officials from NASA announced recently that an expired climate satellite lhad ost its orbit and would fall to Earth. People in Florida and elsewhere in the country had been wondering if their home or even their person could be hit by falling debris. It is no surprise that people question whether their insurance company will pick up the tab to repair any damage -- the satellite weighs 6 tons.

Homeowners can breathe a tentative sigh of relief. According to a spokesperson for the Property Casualty Insurers Association of America, damage caused by an object falling from space onto a home is covered under most property insurance policies.

But the same space junk falling onto a car may be another matter entirely. The compensation an insured would receive in this case is a function of whether the auto policy includes comprehensive coverage. Unfortunately, many car owners let this coverage lapse when the car gets older and is nearing the end of its useful life.

What happens if a person gets hit by falling space debris? Most health insurance policies cover injuries sustained by falling objects. So, a person struck by one of the smaller pieces of the satellite (the largest was estimated to weigh 350 pounds) should be covered for treatment.