Disbarred attorney sentenced to federal prison for mortgage fraud scheme

U.S. District Judge Mark R. Kravitz in New Haven court sentenced Douglas Sheehan, 39, of Meriden, to six months in prison, followed by three years of supervised release for his role in a Hartford-area fraud scheme.

Kravitz also ordered Sheehan to serve the first six months of his supervised release in home confinement, and to perform 200 hours of community service.

According to court documents and statements made in court, between September 2003 and November 2007, Sheehan, a former attorney, conspired with George Hajati, who owned Connecticut Partners Mortgage (CPM), Justin Williams, a CPM employee, and others, to deceive mortgage lending institutions into providing falsely inflated loans to real estate buyers. The properties were worth less than the amount of the loans, federal records show.

CPM provided fraudulent financial statements to the lending institutions that inflated the sales prices of the properties, the down payments made by purchasers and the amount due to sellers, as well as other fraudulent information, to induce the institutions to provide the funds.

The various lenders have suffered a loss of more than $1 million as a result of the mortgage fraud scheme. Between $200,000 and $400,000 in losses can be attributed to Sheehan’s role in the conspiracy, federal officials said.

On November 20, 2008, Sheehan pleaded guilty to one count of conspiracy to commit wire fraud and three counts of wire fraud. He has been disbarred.

On April 5, 2010, Hajati pleaded guilty to one count of conspiracy to commit wire fraud and eight counts of wire fraud. On October 21, 2009, Williams pleaded guilty to one count of conspiracy to commit wire fraud and three counts of wire fraud. Each awaits sentencing.

This case is being investigated by the Federal Bureau of Investigation and prosecuted by Assistant United States Attorney Paul H. McConnell.

The U.S. Attorney’s Office, the Federal Bureau of Investigation and the Connecticut Mortgage Fraud Task Force encouraged you to report any suspected mortgage fraud activity by calling 203-333-3512 and requesting the Connecticut Mortgage Fraud Task Force, or by sending an email to mortgagefraud@ic.fbi.gov.