Category: Mortgage Fraud

Crestwood Developer Gets More Federal Prison Time than Doug Hartmann for Lesser Offense

Post author By Michael R. Allen
Post date September 5, 2009

by Michael R. Allen

Per the St. Louis Post-Dispatch:

The owner of a Crestwood development company was sentenced to 37 months in federal prison Friday for a mortgage fraud that cost lenders hundreds of thousands of dollars and sent 16 homes into foreclosure.

That developer, Joseph A. Baumeister, faces 13 more months in prison than Doug Hartmann, for a lesser crime(see “Doug Hartmann Gets Two Years, Life of Shame”, August 11). Also, the developer will pay $364,504 in restitution, an amount more realistic and more likely to be repaid than the $34 million judged against Hartmann. Assistant U.S. Attorney Jeff Jensen deserves recognition for meting out a stricter sentence for Baumeister than his boss, Acting United States Attorney Michael W. Reap, did against Hartmann.

Mortgage Fraud

Hartmann to Serve Up to 24 Months in Jail for Mortgage Fraud

Post author By Michael R. Allen
Post date April 3, 2009

by Michael R. Allen

One of Doug Hartmann’s wrists will sting — the city’s most prolific con artist has pled guilt to federal charges and heads to sentencing on June 23. At sentencing, Hartmann will face a maximum sentence on 24 months in prison and up to $1.25 million in fines. A press release from U.S. District Attorney Catherine Hanaway, who negotiated the plea bargain details more of Hartmann’s antics that were previously not publicized. The plea arrangement sounds like quite a bargain for Hartmann, who left in his wake over 100 historic buildings in various states of vacancy or incomplete rehabilitation across the city and numerous investors defrauded of their money and, in once case, a house.

One of the Hartmann properties owned under “DHP Properties” was the Nord St. Louis Turnverein in Hyde Park. After Hartmann’s ownership led to continued deterioration of the historic turner hall, the buidling suffered a severe fire in July 2006. Developer Peter George has since purcahsed the building and is trying to rebuild it.

Hanaway promises more prosecution of mortgage fraud artists like Hartmann. However, the light sentence may not send a very strong message to others. One could get more time in jail for possession of a small amount of crack.

US Attorney Indicts Doug Hartmann

Post author By Michael R. Allen
Post date July 13, 2007

by Michael R. Allen

Today the US Attorney’s office announced that it is indicting mortgage fraud artist Doug Hartmann for bank and mail fraud. Hartmann’s scheme involved nearly 250 properties, including scores of historic houses in the city of St. Louis and the Nord St. Louis Turnverein, which burned last July under Hartmann’s ownership.

The Post-Dispatch has the story here.

Mortgage Fraud Rehabbing

Mortgage Fraud Hits Rehab Neighborhoods

Post author By Michael R. Allen
Post date December 5, 2006

by Michael R. Allen

Case here reflects the national rise in mortgage fraud – Robert Patrick (St. Louis Post-Dispatch, November 23)

Sorry for the delay in linking to this article. Read through and find just one of many tales of speculators’ using easy ‘n’ quick mortgages on historic homes in south city and straw buyers to make money. The effect inflates neighborhood rehab housing markets beyond recognition, encouraging legitimate rehabbers to list finished homes at prices grossly beyond their value. Perhaps these stories aren’t publicized because politicians hungry to take credit for a city housing market boom are avoiding looking at the cold hard facts to the contrary.

Don’t get me wrong; I am all for strong housing values. That’s why stories of mortgage fraud are disturbing, because in the end they do more to harm stable, high housing values than to help. Hopefully prosecutors will take these cases seriously.