United States v. Onque

• Decision Date: 09 February 2015
• Docket Number: Criminal Action No. 10–510 (JBS).
• Citation: 169 F.Supp.3d 555
• Parties: UNITED STATES of America v. Dwayne ONQUE, Mashon Onque, and Nancy Wolf–Fels, Defendants.
• Court: U.S. District Court — District of New Jersey

169 F.Supp.3d 555

UNITED STATES of America

v.Dwayne ONQUE, Mashon Onque, and Nancy Wolf–Fels, Defendants.

Criminal Action No. 10–510 (JBS).

United States District Court, D. New Jersey.

Signed Feb. 9, 2015.

Paul J. Fishman, United States Attorney, by: Matthew T. Smith, Assistant U.S. Attorney, Jacqueline Carle, Assistant U.S. Attorney, Office of the U.S. Attorney, Camden, NJ, for the United States.

Peter A. Levin, Esq., Philadelphia, PA, for Defendant Dwayne Onque.

Anne C. Singer, Esq., Jacobs Singer Kivitz & Herman LLC, Haddonfield, NJ, for Defendant Mashon Onque.

Paul J. Urbania, Esq., Shrewsbury, NJ, for Defendant Nancy Wolf–Fels.

OPINION

SIMANDLE, Chief Judge.

I. INTRODUCTION

On October 6, 2014, defendants Dwayne Onque, Mashon Onque, and Nancy Wolf–Fels were found guilty after a four-week jury trial for their roles in a large-scale mortgage fraud conspiracy. The jury convicted all three defendants of conspiracy to commit wire fraud and also convicted defendant Dwayne Onque on one count of conspiracy to commit money laundering.

Defendants Dwayne Onque and Mashon Onque have filed motions for acquittal and for a new trial under Federal Rules of Criminal Procedure 29 and 33. Defendant Nancy Wolf–Fels has filed a motion for a new trial under Rule 33. For the reasons set forth below, Defendants' motions will be denied.

II. BACKGROUND

The Court assumes the parties' familiarity with the underlying facts of this case and recites briefly only those facts particularly relevant for deciding these motions.

On November 6, 2013, a federal grand jury returned a two-count Superseding Indictment (“Indictment”) against seven individuals involved in the conspiracy. Count One charged Defendants Nancy Wolf–Fels, Dwayne Onque, Mashon Onque (“Defendants”) with one count of Conspiracy to Commit Wire Fraud in violation of 18 U.S.C. § 1349. Count Two charged Defendant Dwayne Onque with one count of Conspiracy to Commit Money Laundering in violation of 18 U.S.C. § 1956(h).

Prior to trial, Defendants each filed a motion to exclude certain evidence of uncharged conduct the Government sought to admit under Federal Rule of Evidence 404(b). The Court denied the motions and permitted the Government to offer evidence of Defendants' conduct in several other real estate transactions for limited purposes. [Docket Items 156, 157, & 158.]

The Indictment alleged that Defendants intentionally conspired and agreed with others to devise a mortgage fraud scheme and to obtain money and property by means of materially false and fraudulent pretenses, representations, and promises. According to the indictment, the ringleaders of the conspiracy, which included Nicholas Tarsia, Jr., Timothy Ricks, Darryl Henry, and Jerry Smith, found financially distressed properties, induced lenders to loan funds in excess of the actual value and price of the properties using false sales agreements and loan applications and straw buyers, and, when the properties closed, pocketed the excess funds that were released by the mortgage lenders based on the inflated price. The Indictment charged the defendants with participating in over two dozen fraudulent transactions that occurred between October 2006 and May 2008, although the Government alleges that the scheme continued for much longer. The Government alleges that members of the conspiracy caused approximately 15 million dollars in fraudulent mortgage loans to be released.

The conspiracy required a number of individuals in a variety of different roles. Tarsia, Ricks, Henry, and others recruited straw purchasers to buy distressed properties at a price that was reported to lenders as much higher than the actual sale price. With the help of co-conspirators whose job it was to create false documents, the straw purchasers would submit loan applications with supporting documents reflecting inflated incomes, fictitious jobs or elevated job titles, false bank account balances, and fictitious assets. The loan applications were then submitted to various lenders with the assistance of mortgage brokers. After the mortgages were approved, title clerks prepared closing documents, which included standard HUD–1 Settlement Statements (“Hud–1 statements”) used by lenders to verify the accuracy of loan applications and sales agreements and to certify that loans were properly disbursed. The HUD–1 statements in this case misrepresented the value of the sale and falsely stated that the borrowers brought certain deposits and down payments to the closing when in fact they brought nothing. These false representations played an important role in convincing lenders that the purchasers had a financial stake in the property and were less likely to default. Once the closings went through and lenders released the money, title clerks distributed the proceeds and the co-conspirators received the funds released by the lenders that were in excess of the actual sale price.

At trial, the government presented the following evidence linking defendants Dwayne Onque, Mashon Onque, and Nancy Wolf–Fels to the conspiracy.

A. Dwayne Onque

Dwayne Onque (“Dwayne”) was a straw purchaser who made an agreement with co-conspirators to submit loan applications and purchase properties in his name. Co-conspirator Tim Ricks, who was a childhood friend of Dwayne's, testified that he approached Dwayne to be a potential buyer of properties and made an arrangement with Dwayne to be paid in exchange for using Dwayne's name on loan applications. (9/17 T. 963:13–965:17.) Ricks testified that there was an “unspoken” understanding that Dwayne would apply for the mortgage in his name but Ricks or others would bring the necessary down payments to the closing. (Id. T. 968:20–21; T. 1001:17–21.)

FBI Special Agent Scott Stefanowicz testified that Dwayne signed five loan applications over a period of nine months that contained false information about his job title, income, address, and use of the property. For example, Agent Stefanowicz testified that Dwayne submitted loan applications stating that he was vice president of a company called Diamond Disposal when he was actually a truck driver with the company. (9/11 T. 269:12–270:23.) Similarly, Dwayne's former boss, Daniel Plaxe, testified that Dwayne asked him to inflate Dwayne's title at the company to “more than just a driver” and lie about his income on an employment verification form in connection with Dwayne's mortgage application. (9/22 T. 1149:5–21.)

IRS Special Agent Scott Smith, who interviewed Dwayne in 2008, testified that Dwayne admitted to Smith that he was working with Ricks. Dwayne told Smith that Ricks would pay Dwayne money each time Dwayne's name was used to purchase a property, and that Nick Tarsia would temporarily deposit money into Dwayne's bank account in order to make it appear to a lender that Dwayne had more money. (9/29 T. 1724:12–1725:23.) Dwayne also admitted to Smith that he had asked his employer, Daniel Plaxe, to lie about Dwayne's employment to make it appear to lenders that Dwayne had a better job. (9/29 T. 1725:24–172 6:8.) Dwayne told Smith that he brought no down payments or funds of his own to closings, in contrast to what was stated in the HUD–1 statements. (9/29 T. 1726:9–19.)

Once the funds were deposited in a title company's escrow account, Dwayne and his co-conspirators extracted proceeds from the fraud through wire transfer checks to Tarsia, Ricks, and Henry. Tarsia and Ricks then transmitted a portion of those proceeds to Dwayne. The Government presented evidence of checks from Ricks to Dwayne, which Ricks testified was payment to Dwayne for allowing Dwayne's name to be used on the mortgage applications. (T. 994:21–996:2, 1006:21–1007:5, 1014:20–1–15:6, 1017:22–1018:3, 1021:20–1022:2; Gov't Ex. 512A (check for $15,000), 611A (check for $18,000), 717 (check for $12,000), 823 (check for $15,000), 922A (check for $3500).)

B. Mashon Onque

Mashon Onque (“Mashon”), Dwayne's sister, worked as a Title Officer at Tri–State Title Agency, Inc. in Montclair, New Jersey. Her responsibility as a title officer included overseeing the signing of closing documents, completing a HUD–1 Settlement Statement which verified the accuracy of the loan applications and terms of the transaction, and ensuring that the money was distributed according to the HUD–1. Each HUD–1 that Mashon signed required her to acknowledge that “The HUD–1 Settlement Statement which I have prepared is a true and accurate account of this transaction. I have caused or will cause the funds to be disbursed in accordance with this statement.”

At trial, the Government presented evidence that Mashon was the title clerk for several fraudulent real estate transactions at which she signed inaccurate HUD–1 Settlement Statements for straw purchasers recruited by the co-conspirators. Specifically, Mashon served as a title agent for a transaction in October 2006 for a property at 52 Starr Court in Middletown, New Jersey, purchased in her brother's name (Gov't Ex. 505); and one in May 2008 for a property at 106 South 7th Street in Newark, New Jersey, purchased by straw buyer Kevin Livingston. (Gov't Ex.2007.) In addition, the Government presented Rule 404(b) evidence showing that in September 2006, Mashon acted as the title agent for three other transactions involving two other properties, in September 2006, December 2006, and February 2007. Two of those transactions involved Mashon's brother Dwayne. (Gov't Ex. 3500A, 3600, 3700.) The Government also introduced evidence showing that Mashon deposited into her own account several checks made out to Dwayne around the time of the February 2007 transaction. (Gov't Exs. 3603, 3604, 3605.) The Government finally presented evidence that Mashon notarized the closing documents for transactions involving straw buyers Kevin Livingston and Robert Allen, Jr., even though Livingston and Allen were not present. (See 9/22 T. 1064:20–1067:5; Gov't Br. 14.) Ricks testified that he saw Mashon notarize a number of documents for Livingston outside of...