A Florida title agent is in trouble with the law for her role in a massive property flipping scheme in which multiple fraudulent mortgages were obtained on over 80 properties.

Lisa Rotolo, former owner and operator of Diamond Title in Sarasota, Florida,  was arrested in April 2009 on charges of conspiracy, bank fraud, wire fraud and making false statements in connection with loan applications. 

Investigators say that Rotolo knowingly participated in a scheme in which dozens of properties were sold back and forth between a number of associates at ever-inflating prices.  Based on the spiraling prices, the participants in the scheme were able to obtain larger and larger loans.  With the aid of real estate professionals such as Rotolo, conspirators were often able to falsely inflate the purchase prices of properties for the purpose of obtaining larger mortgages than they would have been able to obtain otherwise, and routinely split "profits" left over after sellers had been paid off.  When properties were purchased from outsiders, the group would use two sets of settlement documents-- one for the sellers and another set for the banks indicating a fictional higher sale price-- in order to generate similar "profits".

In an affidavit to establish probable cause for Rotolo's arrest, federal investigators listed 61 mortgages totaling over $50 million in which Rotolo is alleged to have knowingly participated in fraudulent activity.  Investigators alleged that Rotolo helped an unnamed co-conspirator-- determined to be Sarasota real estate agent Craig Adams by reporters at the Sarasota Herald Tribune-- pull off the frauds by falsifying HUD-1 settlement statements and other documents, and fraudulently disbursing money. 

Investigators detailed how Rotolo, serving in her role as a title agent, helped Adams obtain five fraudulent mortgages on on one Sarasota property:

1. When Adams purchased the property, Rotolo fraudulently assisted Adams in obtaining a mortgage in the amount of $1,480,000 from Washington Mutual bank.  The property was purchased from a seller not involved in the conspiracy for $1,600,000 in March 2005, using a "straw buyer"-- Adams' 80 year old mother.   Rotolo prepared two HUD-1 settlement statements-- one for the sellers, which showed the actual purchase price, and another fraudulent settlement statement which showed an inflated $1,850,000 purchase price.  This fraudulent settlement statement was submitted to Washington Mutual to obtain the mortgage.  Both versions of the HUD-1 statement were later found on Rotolo's hard drive by investigators.  According to investigators, Adams forged his mothers' signature on documents, and Rotolo notarized the forged signatures.
    
2. 10 months later, a second mortgage for $150,000 was obtained from BB&T bank, again using Adams' mother as the borrower.  Rotolo dispersed this money to her Adams, not his mother. 
    
3. 5 months after that, another mortgage was obtained from Countrywide Bank for $310,000, once again using Adams' mother as the borrower.  Again, Rotolo distributed the money to Craig Adams. 
    
4. 9 months later, Rotolo helped Adams obtain another first mortgage on the property in the amount of $1,890,000 from American Home Mortgage.  Rotolo prepared another fraudulent HUD-1 statement and falsely represented to American Home Mortgage that the previous mortgages had been paid off. 
    
5. At the same time, a second mortgage for $350,000 was obtained from National City Bank, using the same fraudulent HUD-1.

Adams, who according to news reports may be the mastermind of a massive property flipping scheme involving dozens of co-conspirators including associates, family members, investors, and real estate professionals, approached the FBI in 2008 and turned informant in return for leniency in his own criminal prosecution.  In cooperating with authorities, Adams has fingered Rotolo and perhaps dozens of other co-conspirators who participated in the flipping scheme. 

According to authorities, the total dollar amount of the fraud may exceed $200 million.  The Sarasota Herald Tribune has identified over $123 million in mortgage defaults directly attributed to individuals identified as participants in the scheme.

Rotolo has not been convicted of any crime to date, and is free and currently works at a Target store, according to news reports.  Sources say that she is cooperating with an ongoing investigation regarding the mortgage fraud conspiracy.