A Cape May County lawyer faces up to five years in federal prison this month when he is sentenced for conspiracy to commit wire fraud in the purchase of nine North Wildwood condominiums in 2007.
Louis C. Dwyer Jr., who has a law office in Lower Township, pleaded guilty last year to the single count in U.S. District Court in Camden.
Dwyer is a former solicitor and land-use attorney who has appeared before many planning boards across South Jersey.
His attorney, Edwin Jacobs, of Atlantic City, did not return calls seeking comment.
According to prosecutors, Dwyer was part of a scheme to defraud lenders for mortgage loans on nine properties in North Wildwood with mortgage loan applications totaling $4.9 million. The properties were on Surf, 23rd, 24th and 25th avenues in North Wildwood.
He faces up to five years in federal prison and a $250,000 fine at the discretion of the judge during his sentencing Jan. 26 in U.S. District Court in Camden. But as part of the plea deal, Dwyer agreed to make restitution comprised of $50,000 monthly payments.
Dwyer was indicted in 2013 along with Fredric DiAntonio and Louis Catarro, co-owners of Blue Ocean Realty in Wildwood, and Kathryn Lockwood, co-owner of Hoffman Agency North in North Wildwood.
According to the indictments, Dwyer was part of a scheme that relied on straw-purchasers who had no financial means to submit mortgage applications with phony information to get loans for the purchase of condos. This involved making the purchasers look more credit-worthy than they were to obtain the loans.
The straw-purchasers were given kickbacks at closing with the intention of reselling the properties at a later date. The sales contracts listed inflated sales prices and deposits from the buyers that were never collected, according to the U.S. Attorney’s Office.
The lenders included Challenge Financial, World Savings Bank, Lime Financial and Advisors Mortgage Group.
The case was one of several similar schemes prosecuted in the wake of South Jersey’s housing boom and bust of the mid-2000s. Had the scheme not unraveled, the properties likely would have fallen into foreclosure and the straw buyers merely would have joined the legion of other homeowners who could not pay their mortgages after the housing bust and recession.
A property manager from Union County, Paul Watterson, 55, of Mountainside, was sentenced to 15 months in federal prison this month for a similar scheme to defraud lenders by getting unqualified straw-purchasers to buy homes at inflated prices in Wildwood Crest and Wildwood.