CAMDEN — A New Jersey man was sentenced Wednesday to four years in federal prison after pleading guilty to a mortgage-fraud conspiracy ring that helped unqualified buyers borrow millions of dollars to buy oceanfront property in Wildwood Crest.
Instead, the money borrowed by the “straw buyers,” which prosecutors said totaled nearly $41 million, went into various accounts of Joseph Witkowski, of Flemington, and other conspirators, prosecutors said.
Witkowski, 70, was sentenced Wednesday, three years after pleading guilty to charges of conspiracy to commit wire fraud and conspiracy to commit money laundering.
He was charged in 2012 with conspiring to defraud lenders by taking out fraudulent mortgages and wiring a portion of the proceeds to private accounts while never paying the monthly mortgage premiums and faced up to 40 years in prison.
In addition to the prison term, Witkowski was sentenced to three years of probation and ordered to pay $13,105,570 in restitution. As part of his plea agreement, he must forfeit $2,412,899, representing the proceeds of the fraud, prosecutors said.
U.S. District Judge Joseph H. Rodriguez imposed the sentence in Camden federal court. Public defender Maggie Moy, who represented Witkowski, was not immediately available for comment. Assistant U.S. Attorney Diana Carrig represented the government.
Witkowski is a former lawyer who, according to the indictment from 2012, conspired with nine other people between 2006 and 2008 to sell oceanfront residences at four Wildwood Crest condominiums, which were overbuilt by financially distressed developers, and at resorts in South Carolina and Georgia.
Witkowski and his co-conspirators recruited the straw buyers to purchase the properties, offering to pay them for using their names and promising them they would never have to make a payment on the mortgage.
The group created fake documents to obtain the mortgages in the names of their straw buyers, who had good credit but not the financial means necessary to take on the mortgage.
“Once the loans were approved and the mortgage lenders sent the loan proceeds in connection with real estate closings on the properties, Witkowski and his conspirators had some of the funds wired or checks deposited into various accounts that he and his conspirators controlled,” the U.S. Attorney’s Office said.
The FBI and IRS assisted in the investigation.