2 loan brokers from Easton, Boston plead guilty in bank fraud scheme, U.S. Attorney’s Office says
Two loan brokers from Easton and Boston have pleaded guilty in connection with a bank fraud scheme that cost a Massachusetts-based bank thousands of dollars, the U.S. Attorney’s Office said.
Ted Capodilupo, 57, of South Easton, and Joseph Masci, 71, of Boston, pleaded guilty in federal court to one count each of conspiracy to commit bank fraud, the U.S. Attorney’s Office said in a statement late Friday. U.S. Senior District Court Judge Mark Wolf scheduled sentencing for Sept. 8.
Capodilupo and Masci were charged in January 2022 along with Brian Ferris of Braintree, a loan officer at a bank headquartered in Springfield, for conspiring to defraud the bank and the U.S. Small Business Administration, according to prosecutors and court documents.
Ferris pleaded guilty to one count of conspiracy to commit bank fraud on April 21. He is scheduled to be sentenced on Aug. 3, 2023.
Capodilupo and Masci were loan brokers and principals of MJD Group LLC, and also did business under the names ABM Financial Group and Asist2finance, all which were loan marketing and referral businesses, according to court documents.
The scheme involved Capodilupo and Masci charging borrowers fees for fraudulent loan applications that they then submitted using fabricated information, prosecutors said.
According to court documents, the sceme involved Capodilupo and Masci charging clients fees of between approximately $2,500 and $10,000 to obtain loans for them, and then arranging for their fees to be paid out of the proceeds of the loans, and ; and concealing the scheme from the bank and the SBA.
The scheme generated approximately $270,000 in fees for Capodilupo and Masci, and many of the loans that the bank issued as a result of the fraudulent applications ultimately defaulted, resulting in substantial losses to the bank, prosecutors said.
According to the U.S. Attorney’s Office, between 2015 and 2018, Capodilupo, Masci and Ferris agreed to defraud the bank and the SBA by submitting fraudulent loan applications to the bank, which administered the SBA’s small business express loan program, to secure bank loans guaranteed by the SBA.
Specifically, Capodilupo and Masci submitted dozens of fraudulent loan applications to the bank on behalf of borrowers who were ineligible for traditional business loans, the U.S. Attorney’s Office said.
“These loan applications misrepresented, among other things, the identity of the real loan recipients and the businesses for which the loans were sought,” the U.S. Attorney’s Office said.
According to the U.S. Attorney’s Office, Capodilupo and Masci also fabricated federal tax forms submitted in support of the fraudulent loan applications, falsified applicant signatures and falsely indicated that no broker had assisted in preparing or referring the loan applications.
“Capodilupo and Masci charged borrowers fees for obtaining these fraudulent loans. Ferris, who worked as a loan officer at the bank, caused the bank to issue loans for which Capodilupo and Masci submitted applications and received a kickback from Capodilupo and Masci of approximately $500 per loan,” the U.S. Attorney’s Office said.
The charge of conspiracy to commit bank fraud provides for a sentence of up to 30 years in prison; five years of supervised release; a fine of up to $1 million or twice the gross gain or loss, whichever is greater; restitution; and forfeiture.
This is a developing story. Check back for updates as more information becomes available.
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