ST. PETERSBURG, Fla. – Sept. 19, 2008 – Florida prosecutors filed suit this week against 10 companies and 15 people they say were involved in a $37 million real estate straw mortgage scheme.
The scheme, which involved applying for mortgages to purchase homes with inflated prices, also resulted in 50 homes falling into foreclosure, the St. Petersburg Times reported Thursday.
The suit claims attorney Allen Boyarksy and others recruited buyers with good credit records and paid them to apply for mortgages, which they did not pay. The profits from inflating the prices of the homes, however, did not go to the sellers, but to others involved in the scheme, the Times reported.
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