BUFFALO, NY – Prominent upstate New York landlord Robert Morgan was charged Wednesday in a 114-count federal indictment with inflating property values in its vast real estate portfolio for more than $500 million in loans.
The indictment also named Morgan’s son, Todd Morgan, and two other members of the Pittsford-based Morgan Management, LLC.
The Morgans, along with the broker Frank Giacobbe and former financial director Michael Tremiti, pleaded not guilty Wednesday.
“The current costs claim of Robert Morgan and the men he surrounded himself with in the business community worked hard with the desire to be creative will undermine the integrity of the financial sector,” FBI Special Agent-in-Charge Gary Loeffert said at a press conference.
The indictment wants the forfeiture of $267.3 million and several apartment complexes in Rochester, Buffalo and elsewhere in the north of the state of New York and Pennsylvania.
The charges come a year after the indictments of three other company jackets, who since pleaded guilty. Authorities say the investigation is ongoing.
According to his website, Morgan’s portfolio includes more than 140 properties and 34,000 units in 14 states.
Prosecutors said the company provided false information on the income of the properties in the different member states, loans from institutions, including the government-controlled Freddie Mac and Fannie Mae. Managers maintained two sets of books for at least 70 properties, researchers said one with accurate numbers and the other filled with manipulated figures given to the lenders for the maintenance and refinancing of loans.
“The scale of the fraud and the deception alleged here, both in a geographical sense, as in an amount of the mortgages and the properties involved is very large,” the Attorney of the V. S. James Kennedy Jr. has said. “This kind of fraud strikes at the very heart of that banking, insurance and mortgage industry.”
Charges against the men include conspiracy to commit wire fraud, fraud and money laundering. The Morgans also be charged in a $3 million insurance fraud scheme for allegedly inflating repair bills on claims submitted to the insurers.
Robert Morgan ‘ s lawyer could not be reached by phone after the charges were announced. Todd Morgan ‘ s lawyer, David Rothenberg, and Tremiti’s lawyer, Donald Thompson, declined to comment. Giacobbe, the lawyer not immediately return a phone message.
If convicted, the entrepreneurs could face up to 30 years in prison.