U.S. DISTRICT COURT
Woman Pleads Guilty in Greenbelt to Money Laundering in Mortgage Fraud Scam
Wednesday, April 29, 2009
One of the five people accused this week of participating in a $70 million mortgage fraud Ponzi scheme pleaded guilty yesterday, admitting in documents filed in federal court that the company did not provide the service it advertised.
Carole Nelson, appearing before U.S. District Judge Roger W. Titus in Greenbelt, pleaded guilty to a single count of money laundering. She agreed to forfeit two homes, in Virginia and Washington, and faces up to 10 years in prison.
According to a grand jury indictment, her employer, Metro Dream Homes, promised to pay off homeowners' mortgages in five to seven years in exchange for investments of at least $50,000. At least 1,000 people, many from Prince George's County, turned over about $70 million, according to prosecutors.
But instead of investing the money in business ventures, as they said they would, the defendants used some of the funds from new investors to make mortgage payments for earlier ones, prosecutors said. Millions more went to finance annual salaries of as much as $200,000, luxury cars and trips, according to prosecutors.
Prosecutors said Nelson was the chief financial officer for a Dream Homes company. In her 20 months of employment with Metro Dream Homes, she received $413,075 in compensation, prosecutors said.
In court papers, Nelson also acknowledged that she lied about her income to try to qualify for a $200,000 Bentley. Two senior employees with the company purchased Bentleys on a single day, the papers said.
Nelson is scheduled to be sentenced Aug. 6.