A mortgage broker in Buffalo, New York, admitted his involvement in a real estate scandal that aimed to defraud multiple financial institutions. The case centers on Morgan Management. The real estate management company owns thousands of properties in Buffalo, other New York cities and over a dozen states.
Patrick Ogiony, 35, pleaded guilty to one count of conspiracy to commit bank fraud. He was accused of conspiring with three other businessmen to defraud financial institutions such as UBS Securities and Arbor Commercial Mortgage. The mortgage broker allegedly gave lenders false information about Morgan Management-owned apartment complexes in several states.
Ogiony is a former employee of Aurora Capital Advisors, a mortgage brokerage company. He said his employer had directed him to participate in efforts to make apartment complexes seem more profitable than they actually were. The false information convinced financial institutions to issue loans for larger amounts.
Ogiony allegedly inflated rent rolls and overstated the incomes of the properties, as well as the number of renters in them. He and others used various methods to dupe inspectors into believing that vacant apartments had tenants. For example, they placed shoes outside the doors.
Although Ogiony faces up to five years in prison and a $250,000 fine, his sentence could be reduced if he cooperates with federal authorities in their investigation.