A New York mortgage banker was indicted this month, after a 17-month investigation, on charges of pocketing millions of dollars from warehouse lenders.
Angela Daidone-Supthen, the president of Morning Star Mortgage Bankers Inc. of Farmingdale on Long Island, was charged with two counts of wire fraud and one count of criminal forfeiture in the amount of $2.5 million. The New York State Banking Department said Ms. Daidone-Supthen double-sold loans to several warehouse lenders that had been providing her company with lines of credit to fund mortgages, and that she gave one lender misleading statements about her companys financial condition.
In essence, she is accused of routinely using one loan application to get money from two warehouse lenders and then stealing the money from one of them.
The warehouse lenders include Provident Bank of Cincinnati, Regents Funding in Atlanta, and Impac Warehouse Lending Group of Newport Beach, Calif., according to the indictment.
Millie Freel-Mackin, the departments director of mortgage banking examinations, said she first learned of the matter on the evening of April 13, 2000. That, she said, is when Bruce Brady, the Federal Bureau of Investigations special agent in charge of white-collar crime, told her that his agency had been investigating Ms. Daidone-Supthen and had frozen Morning Stars accounts.
The Banking Department quickly suspended, but did not revoke, the companys license and fined Ms. Daidone-Supthen $25,000. The suspension was shortly lifted, but a series of investigations and regulatory proceedings, with the help of the U.S. Attorneys Office for the Eastern District of New York, followed.
These led to the revocation of Ms. Daidone-Supthens license last month and the Aug. 9 indictment, Banking Department officials said.
On June 30, 2000, the department said, it agreed to restore the license if she would provide proof that she had the $250,000 necessary to operate as a mortgage banker in the state, and if she obtained a $1 million warehouse line of credit to fund the loans in her pipeline.
The next month, Ms. Freel-Mackin said, Ms. Daidone-Supthen provided a financial statement claiming that on June 30, Morning Stars account at a GreenPoint Bank branch in Massapequa, N.Y., had a balance of $62,631.47.
Also provided, Ms. Freel-Mackin said, was a letter from a lawyer, Gregory LaMarca, on stationery with his letterhead. The letter, she said, stated that Mr. LaMarca had instructed Ms. Daidone-Supthens accountant to overlook a $595,000 judgement against her when creating the financial statement.
However, the Banking Department said a six-month joint investigation with the FBI showed that both of the documents were forgeries.
Last fall, Ms. Freel-Mackin said, GreenPoint Bank told the department that Morning Star had $12.28 in its account on June 30. Sharon Farrel, a lawyer with the Banking Departments criminal investigations bureau, said that C. Clifford Hutchinson, the accountant who supposedly created the financial statement, told investigators that he had nothing to do with it.
Also, Ms. Farrel said, Carl Bennett of Long Island admitted to investigators that he had drawn up the statement for a few thousand dollars, though he is not a certified public accountant.
Ms. Farrel said the lawyer Mr. LaMarca told investigators that he had not written the letter that Ms. Daidone-Supthen had submitted.
After the investigators discovered that the documents were phony, Ms. Freel-Mackin said, the Banking Department called Sterling Bank in Southfield, Mich. one of Ms. Daidone-Supthens warehouse lenders to check on the financial statements she had provided. These too turned out to be forgeries, Ms. Freel-Mackin said.
The FBI arrested Ms. Daidone-Supthen on Feb. 27.
Ms. Farrel said four mortgage-related cases are also pending against Ms. Daidone-Supthen in Nassau County Court.
Banking Department Superintendent Elizabeth McCaul revoked Morning Stars license July 9. Ms. Daidone-Supthen is expected to face arraignment this week in U.S. District Court in Brooklyn, according to the banking department.
Neither the FBI nor the U.S. Attorney returned calls.