The down payment scam is just one part of a story that involves drugs, homelessness and a shot at redemption
Last week, a former Tampa-area mortgage broker was sentenced to 15 months in federal prison after pleading guilty to making false statements to financial institutions on mortgage applications. Jonathan Marmol and real estate developer Mordechai Boaziz cooperated in a scam that saw Marmol’s lending partners lose more than $5 million.
The scheme dates back to before the 2007 financial meltdown, when most U.S. housing markets were being fuelled by a combination of shady lending and oversight which, in hindsight, was so weak that it bordered on the absurd. It was the perfect environment for Boaziz and Marmol to try and pull one over on the banks.
In 2006, the pair were working on a condo conversion project for which Marmol was hired to market the units. The marketing strategy was effective enough – buyers were told they would not have to make their down payments – except it was completely illegal. Marmol told lenders that the down payments came from the buyers themselves.
It didn’t take long for the truth to come out. The housing market tanked, several mortgages related to the development failed and Marmol’s lenders lost millions.
When Marmol first pled guilty in November 2019, he and Boaziz both faced five-year sentences. His reduced punishment would seem to reflect a belief on the part of U.S District Judge Virginia Hernandez Covington that Marmol’s acceptance of blame and the several years of painful personal development he put himself through leading up to his sentence were both worthy of consideration.
“Twelve years ago, I made a series of bad actions and decisions that harmed people close to me, myself and the community at large,” he said in a written statement to the court. “I am deeply regretful of the harm and damage I caused.”
Marmol’s life as a broker was fraught with alcohol and drug abuse, and things didn’t improve once he left Florida. Five years of homelessness and drug-related hospitalizations followed, but Marmol’s life began turning around after he completed a substance abuse program and began dedicating his life to helping others avoid making the same mistakes he made. The work he put into getting his psychology degree, which he received earlier this year from the University of South Florida, put him on the dean’s list.
According to Fairway’s Ryan Grant, Marmol’s punishment, which will sadly make his career as a drug counsellor next to impossible, is somewhat aggressive considering the crime.
“But every now and then you get a judge who wants to make an example of someone to deter it from happening again,” he says. “We have had a few instances out here in southern California where crimes were committed and judges were really harsh, where I thought that the punishment didn’t fit the crime. Then I’ve seen others where there was almost no punishment at all. I can’t say that there is any consistency from what I’ve seen.
While stories like Marmol’s are relatively uncommon, brokers who bend the rules are not. According to Grant, raising the bar for entry into the industry would help reduce the number of individuals polluting it.
Citing data from the Nationwide Multistate Licensing System, Grant says that of the almost 38,000 applications to become licensed loan officers received by the NMLS in 2019, only 36 were denied.
“This just goes to show you that as an industry, we are not focused on creative, value-based, financially literate, and fiscally responsible mortgage advisors. We are only interested in collecting licensing fees, and the consumer is always going to be negatively impacted by this,” he says.
Grant explains that before becoming a licensed cosmetologist, a person needs to amass 1,600 hours of education and experience. To become a licensed mortgage professional – who, unless you’re a Kardashian, carries significantly more responsibility – that same person needs 20 hours of education; none of which, according to Grant, “teaches you anything about actually providing financial advice or guidance.”
“We need to change this for the consumer’s sake,” he says.
