TRENTON
- Attorney General Peter C. Harvey announced
that a Union County man has been ordered
to repay more than $4.19 million in restitution
after pleading guilty to numerous counts
of theft and related charges stemming
from several insurance and mortgage fraud
schemes, including a scam designed to
rip-off a mortgage company involved in
the purchase of a multi-million dollar
residential property located in Bergen
County.
According to Vaughn L. McKoy, Director,
Division of Criminal Justice and Insurance
Fraud Prosecutor Greta Gooden-Brown, Paul
LoPapa, 59, Summit Road, Mountainside,
Union County, was ordered by Bergen County
Superior Court Judge William C. Meehan
to pay more than $4.19 million in restitution
and fines and to serve five-years probation.
In addition, LoPapa was barred from using
the Internet while on probation. Judge
Meehan also granted the State permission
to monitor LoPapa’s phone bills.
On May 3, LoPapa pleaded guilty before
Bergen County Superior Court Judge William
C. Meehan to charges contained in a State
Grand Jury indictment. The indictment
charged LoPapa with various crimes including
theft by deception, falsifying records,
and forgery. At the hearing, LoPapa also
pleaded guilty to a separate criminal
Accusation charging him with four counts
of theft by deception and one count of
attempted theft by deception. LoPapa has
served more than 500 days in custody for
the charges.
In pleading guilty to the charges in the
State Grand Jury indictment, LoPapa admitted
that between Nov. 1, 1995 and Feb. 1,
1996, he purchased residential real estate
(mansion and guest home) located at 73
and 77 East Saddle River Road in Saddle
River, Bergen County. An investigation
by the Division of Criminal Justice -
Office of Insurance Fraud Prosecutor determined
that LoPapa funded the purchase of the
Bergen County property through Castle
Rock Real Estate - a real estate partnership
controlled by LoPapa. The purchase was
accomplished by creating a fictitious
person - Joseph Georges - and representing
that Georges was willing to buy the real
estate from LoPapa for $4.9 million. The
investigation determined that LoPapa created
worthless promissory notes and other financial
documents to lure a mortgage lender to
back the purchase. Using the worthless
promissory note and $1 million in purported
cash, LoPapa induced a mortgage lender
to advance $3.35 million to finance and
acquire the Saddle River property. The
mortgage lender in turn, sold the worthless
note to an Arkansas mortgage broker. The
investigation further revealed that, immediately
after the bogus Georges transaction, LoPapa
transferred the property to his company,
Castle Rock Real Estate, Inc.
LoPapa
further admitted that between April, 1996
and January, 1997, he falsely inflated
a homeowner’s insurance claim in
the amount of $33,400 for artwork that
was purportedly damaged by a leaky roof
at the East Saddle River Road property.
LoPapa submitted the inflated claim to
the Great Northern Insurance Company.
An investigation by the Division of Criminal
Justice - Office of Insurance Fraud Prosecutor
determined that the artwork never existed.
When pleading guilty to the criminal Accusation,
LoPapa admitted that between April and
August, 2000, that he stole more than
$84,000 in loan application fees from
four victims. LoPapa represented that
he was a real estate investor and mortgage
broker employed by the Citadel Group of
Companies. LoPapa induced persons looking
for real estate loans to pay mortgage
application fees, which he (LoPapa) then
stole.
State Investigator Joseph Luccarelli and
Deputy Attorney General Nicole D. Rizzolo
of the Division of Criminal Justice -
Office of Insurance Fraud Prosecutor were
assigned to the investigation. Det. Sgt.
Brian Giannini and Det. Sgt.Thomas Goletz
of the New Jersey State Police assisted
in the investigation.
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