Preet Bharara, the United States Attorney for the Southern District of New York, announced that EDWIN JACQUET, the leader of a fraudulent credit repair scheme, pled guilty today in Manhattan federal court to one count of conspiracy to commit bank fraud. As part of his plea agreement, JACQUET agreed to make restitution of over $9 million to the victims of his offense. JACQUET pled guilty before United States Magistrate Judge Kevin Nathaniel Fox.
Manhattan U.S. Attorney Preet Bharara said: “Banks and other lenders rely on credit bureaus to ensure the credit-worthiness of potential borrowers. As a result of Edwin Jacquet’s fraudulent scheme, they unwittingly extended millions of dollars worth of credit to unqualified loan applicants and were left holding the bag. This case underscores the commitment of this Office to pursue and prosecute individuals who commit this, and other types of financial crimes.”
According to the Indictment and statements made during JACQUET’s guilty plea:
Consumer Reporting Agencies, commonly known as “credit bureaus,” are businesses that provide reports to third parties about the credit-worthiness of consumers. Credit bureaus gather information used to generate credit reports from many sources, including “furnishers.” Furnishers include entities that provide consumers with credit, such as credit card companies, mortgage lenders, automobile lenders, and department stores.
In September and October 2007, Highway Furniture, Inc. (“Highway Furniture”), a Brooklyn-based business, became a furnisher. In July 2008, New York Funding Group Inc. (“New York Funding”), a Long Island-based business, became a furnisher. They did so by entering into various agreements with at least two credit bureaus. The agreements allowed Highway Furniture and New York Funding to furnish data about any of their customers to the credit bureaus with which they had agreements.
From 2007 through 2009, through Highway Furniture and, later, New York Funding, JACQUET and others engaged in a scheme to falsely and fraudulently improve the credit histories and credit scores of thousands of individuals who purportedly were customers of the two entities (the “Purported Customers”). As part of the scheme, in exchange for thousands of dollars in fees, JACQUET and his co-conspirators provided credit bureaus with fictitious information showing that Highway Furniture and New York Funding had extended credit to the Purported Customers and that the loans had been, or were being repaid. In fact, the individuals had never been extended credit by Highway Furniture and New York Funding. The purpose of providing the fraudulent information to the credit bureaus was to generate fake positive credit history and, thereby, improve the credit histories and credit scores of the Purported Customers. New York Funding and Highway Furniture typically obtained customers by working through a
network of brokers who promised individuals that the brokers could have their credit “repaired.”
JACQUET and his co-conspirators also fraudulently improved the credit histories and credit scores of some of the Purported Customers by deleting accurate, but negative, credit information maintained by the credit bureaus. As a result of their improved credit histories and credit scores, the Purported Customers obtained millions of dollars in loans from banks and other lenders.
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JACQUET, 39, resides in Brooklyn, New York. He faces a maximum sentence of 30 years in prison, a maximum term of five years of supervised release, and a fine of the greatest of $250,000, or twice the gross pecuniary gain derived from the offense or twice the gross pecuniary loss to the victims.
JACQUET is scheduled to be sentenced by United States District Judge Naomi Reice Buchwald on July 19, 2012, at 4:00 p.m.
The Indictment, which was unsealed on July 25, 2011, charged JACQUET along with his alleged co-conspirators: Peter Romeo, 36, of Brooklyn, New York, Edwin J. Mansour, Jr., 44, of Staten Island, New York, and Denise Hudson, 48, of Roosevelt, New York. The charges against Mansour, Romeo, and Hudson remain pending, and these defendants are presumed innocent unless and until proven guilty.
Mr. Bharara praised the outstanding efforts of United States Secret Service in the investigation. He also thanked Experian Information Solutions, Inc., and TransUnion LLC for their assistance.
This case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorney Daniel W. Levy is in charge of the prosecution.