Say Suspects Exploited Their Debts
A Queens grand jury has indicted a real estate investor and a disbarred attorney with unfairly taking advantage of a Queens Village couple in financial distress to steal more than $65,000 in proceeds from the sale of their house, it was announced.
The suspects were identified by Queens District Attorney Richard A. Brown as real estate investor Jose Toral, 28, of Vanderbilt Boulevard in Oakdale, L.I., and attorney Thomas Zacharia, 38, of Leigh Avenue in Staten Island, who was disbarred in April 2008 as a result of an unrelated matter.
Toral and Zacharia were arraigned last Thursday, Mar. 8, before Queens Supreme Court Justice Fernando M. Camacho on a seven-count indictment charging them with second- and third-degree grand larceny, secondand third-degree criminal possession of stolen property and first- and second degree falsifying business records. Additionally, Zacharia was charged with fourth-degree criminal facilitation.
Toral was ordered held on $5,000 bail and to return to court on Monday, Mar. 19, and Zacharia was released on his own recognizance and ordered to return to court on Apr. 20. If convicted, they each face up to 15 years in prison.
“It is alleged that the homeowners were instructed to permit title to their home be put in the name of one of the defendants for one year, during which time the homeowners could use the mortgage proceeds to pay off their debts, improve their credit rating and obtain a more favorable mortgage on the home before title was returned to them,” Brown said. “What allegedly occurred, however, was that the defendants arranged for only a portion of the homeowners’ debts to be paid off while retaining a major portion of the mortgage proceeds for themselves. The property eventually went into mortgage default.”
According to the charges, the two victims-a 70-year-old man and his 53-year-old wife-verbally agreed in May 2007 to sell their residence located on 217th Street in Queens Village to Toral as a result of mounting debt. The terms of the deal included the understanding that they could remain in their home, make monthly mortgage payments to him, and then after a year be allowed to repurchase the property.
The verbal agreement also allegedly provided that the proceeds from the home’s sale-which totaled approximately $94,000-would be held in escrow and be used to pay the victims’ debts.
Reportedly two different contracts of sale were executed for the sale of the property. One allegedly listed the purchase price as $444,140 with no down payment and a rider which provided for Toral to receive $50,000 from the sale proceeds in exchange for the repurchase and leaseback option.
However, the investigation found that this contract allegedly was never submitted to CitiMortgage, the lending institution, nor were the rider terms explained to the victims by Zacharia. It is alleged that the actual contract of sale that was submitted to CitiMortgage provided for a purchase price of $504,700 and a down payment of $40,000 to be held in the escrow account of Toral’s attorney, the law firm of Marschhausen and Fitzpatrick.
It is further alleged that the property was transferred by deed to Toral on Aug. 14, 2007, and that the victims were represented at the closing by Zacharia.
According to the charges, although the victims allegedly had never met with Zacharia before the closing, a letter signed by Zacharia and in the files of Precision Financial, the mortgage broker, stated that he was in receipt of a $40,000 down payment from Toral. In turn, Toral represented on his mortgage application that he had $40,000 in his savings account for the down payment.
However, a review of his bank records for that time period allegedly indicated that his account balance averaged approximately $7,000.
Toral also allegedly represented on his mortgage application that he was previously employed by Marschhausen and Fitzpatrick as a marketing coordinator with a monthly salary of $8,000-though, it is alleged, both attorneys deny ever employing Toral.
Additionally, Toral allegedly represented to CitiMortgage that the property would be his primary residence when, in fact, he knew that the intention was to have the victims remain in possession of the property.
Finally, it is alleged that the HUD settlement statement indicated that approximately $93,537 was due to the victims upon sale of the property. On Aug. 15, 2007, CitiMortgage’s closing attorney wrote a check for $42,931.89 that was made payable to Zacharia as attorney for the victims and allegedly deposited into Zacharia’s attorney escrow account.
On Aug. 23, 2007, Zacharia allegedly withdrew $42,931.89 from his escrow account in the form of a bank check made payable to JT Marketing, a company owned by Toral, and which was then deposited into JT Marketing’s bank account.
Then on Sept. 24, 2007, it is alleged that a check in the amount of $51,128-and again made payable to Zacharia as the attorney for the victims- was written on the account of Accurate Title Service, Inc., with a memo on the check that it represented the release of escrow funds pertaining to the 70-year-old male victim.
Zacharia allegedly deposited the check into his attorney escrow account. Three days later, on Sept. 27, 2007, Zacharia allegedly withdrew $51,128 from his account in the form of a bank check made payable to JT Marketing. In total, Toral is alleged to have received approximately $94,059.89 from the sale of the property.
As part of the agreement with the victims, Toral allegedly arranged to have a debt management company pay a portion of the victims’ debts ($28,800), leaving him with a balance of $65,259.89.
Following the closing, the victims made monthly cash payment to Toral. Beginning on March 1, 2008, Toral allegedly failed to make additional mortgage payments and, in return, the victims stopped paying Toral. A foreclosure action was then commenced on the property.
The investigation was conducted by Det. Richard A. Lewis, of the District Attorney’s Detective Bureau, under the supervision of Sgt. John W. Kenna, Lt. Robert J. Burke and the overall supervision of Chief Lawrence J. Festa and Deputy Chief Albert D. Velardi.
Senior Assistant District Attorney Khadijah Muhammad-Starling of the District Attorney’s Elder Fraud Unit is prosecuting the case under the supervision of Assistant District Attorney Kristen A. Kane, chief of the Elder Fraud Unit, and Assistant District Attorneys Gregory Pavlides, bureau chief of the District Attorney’s Economic Crimes Bureau, and Christina Hanophy, deputy bureau chief, and the overall supervision of Executive Assistant District Attorney Peter Crusco and Deputy Executive Assistant District Attorney Linda Cantoni of the Investigations Division.
It was noted that an indictment is merely an accusation and that a defendant is presumed innocent until proven guilty.
