O’side men arrested in loan modification scheme

Two Oceanside men, David Gotterup, also known as “David Gott,” and Jason Green, both 35, were charged in an eleven-count indictment with conspiracy to commit mail fraud, wire fraud, and bank fraud in connection with a scheme to defraud homeowners who were attempting to modify their mortgage loans, and related mail fraud counts. The indictment also charged Gotterup with conspiracy to commit wire and bank fraud in connection with a scheme to improperly obtain mortgage loans, and related bank fraud counts, disaster loan fraud, and aggravated identity theft.

The charges were announced by Kelly Currie, Acting United States Attorney for the Eastern District of New York, along with representatives from the FBI, the federal department of Housing and Urban Development and others.

According to court filings, from 2008 to 2012, Gotterup and Green allegedly convinced more than a thousand homeowners to pay thousands of dollars each in advance fees based on false promises of relief through government mortgage modification programs including the Home Affordable Modification Program (HAMP).  Gotterup also defrauded financial institutions and the Federal Housing Administration by obtaining mortgages on properties in Brooklyn and Queens by falsifying loan applications and providing false documentation to support the loan applications.  In addition, Gotterup used another person’s social security number in connection with these schemes.

After Hurricane Sandy in 2012, Gotterup also applied for a low-interest disaster relief loan from the U.S. Small Business Administration (SBA), allegedly using false information to support the application.  As a result, Gotterup received a loan of $113,900 from the SBA.  Instead of using the funds to repair property damaged in the disaster, Gotterup used the money to pay for personal expenses, including wedding-related expenses in Cancun, Mexico.

The men were arraigned before United States Magistrate Judge James Orenstein at the federal courthouse in Brooklyn on Oct. 7, Assistant United States Attorneys Sylvia Shweder and Bonni Perlin were in charge of the prosecution.