Charges have been laid in a $12-million mortgage fraud scheme involving 22 Calgary properties and eight financial institutions.
The investigation is being lead by Alberta Law Enforcement Response Teams (ALERT).
ALERT says there is no evidence that this scheme is connected to an ongoing RCMP investigation that began earlier this year into allegations of mortgage fraud involving the Bank of Montreal.
Ali El-Sayed, the alleged ring-leader, surrendered to police on the advice of his lawyer on July 29. The 31-year-old and his company, Ramses Holdings Inc., have been charged with 23 counts of fraud over $5,000. El-Sayed was also charged with one count of extortion.
El-Sayed was released from custody on July 30 on $12,500 bail and faces numerous court conditions, including surrendering his passport and 16 no-contact orders. He must also report in person to an ALERT investigator every two weeks.
Another person connected to this scheme, Christos Fotopoulos, 28, surrendered to police Wednesday. He has been charged with three counts of fraud over $5,000.
An arrest warrant has been issued for a third person, Russell Kilba, 34. He is wanted on 10 counts of fraud over $5,000.
All three accused were Calgary residents at the time of the offence.
ALERT's investigation began in September 2008 with the help of 12 witnesses.
The witnesses were all recruited as mortgage nominees and either knew the accused or were acquaintances of the men. The scheme was allegedly pitched to them as an investment opportunity.
The nominees, also known as straw buyers, were allegedly asked to allow their name to be used to obtain a mortgage and were then told that the accused would take it over in their own names after six months.
In exchange for their identities, each straw buyer allegedly received between $3,000 and $5,000. Eventually, the accused allegedly walked away from the scheme with a large amount of money, leaving the nominees holding the mortgages.
The financial institutions allegedly defrauded in this case include:
Scotiabank, TD Bank, ATB Financial, First National Financial, CIBC, Merix Financial, Royal Bank and MCAP Financial.
ALERT was assisted by several law enforcement agencies and units during the course of this investigation, including Calgary Police Service's Economic Crime Unit, Integrated Proceeds of Crime (IPOC) and Calgary Criminal Intelligence Unit (CCIU).
In a separate investigation, the CPS's Economic Crime Unit has also charged El-Sayed in connection with one case of mortgage fraud totaling $1.2-million. In that case, he has been charged with one count of committing fraud over $5,000.
