Latest news with #mortgagefraud
Fox News
3 days ago
- Business
- Fox News
How Trump's 'no shrinking violets' DOJ is digging in on Schiff's mortgage dealings as legal peril looms
The Department of Justice is likely digging into Sen. Adam Schiff's mortgage paperwork trail stretching back to a Maryland home purchase from the early 2000s as it weighs whether it has an airtight case to potentially prosecute the longtime political foe of President Donald Trump, according to a Cornell Law School professor. "The one thing they don't want to do is to bring a case that fails," William Jacobson told Fox Digital in a Zoom interview, referring to the DOJ potentially investigating Schiff's alleged mortgage fraud. Jacobson is a clinical professor and the Director of the Securities Law Clinic at Cornell. "Either it fails legally, or it fails in court. They don't want to lose that case if you're going against a major political opponent. And that's part of the calculation that will take place." Jacobson talked about the ins and outs of the Democratic California senator's potential legal woes following the U.S. Federal Housing Finance Agency sending a letter to the DOJ this year claiming that Schiff falsified banking and property documents by listing two homes – on two separate coasts – as his primary residence out of an effort to allegedly get more favorable loans. The DOJ has not yet said whether it would take up the case, but is likely digging into Schiff's paper trail as it weighs whether to move forward, Jacobson explained. "I would expect that the first thing the Department of Justice is going to do is to gather documents. There will be a paper trail here. There will be many things that are documentable, and not 'he said, she said,' as to where Adam Schiff was actually living," he said. As investigators go through the documents, they will ask questions such as: What was his actual primary residence? What did he sign? Who was present when he signed? Did he have conversations with people about it? The law professor, who founded the popular conservative legal blog Legal Insurrection, said that there will likely be a "significant paper trail" to go through due to the case stretching back more than 20 years and due to companies keeping tight records following the 2008 financial crash. "Mortgage companies preserve all of these things because of the financial crisis and other things. They have to maintain these records. . . . And I would expect that that would be the first thing the Department of Justice would look at is the paper trail and the circumstantial evidence as to where Adam Schiff was, in fact, living," he continued, remarking that there are "no shrinking violets" at the Trump DOJ. Schiff first fell under scrutiny this year in May, when the U.S. Federal Housing Finance Agency (FHFA) sent a letter to the Department of Justice sounding the alarm that, in "multiple instances," Schiff allegedly "falsified bank documents and property records to acquire more favorable loan terms, impacting payments from 2003-2019 for a Potomac, Maryland-based property." At the heart of the issue are two properties purchased by Schiff: a home purchased in 2003 in Potomac, Maryland, for $870,000 under a Fannie Mae-backed mortgage agreement for $610,000 at a rate of 5.625% over a term of 30 years, and a 2009 Burbank, Calif., condo. Schiff reaffirmed the Potomac property as his principal residence in mortgage refinancing paperwork in 2009, 2011, 2012, and 2013, according to the FHFA letter to the DOJ. Over the same time frame, Schiff took a homeowner's tax exemption on the Burbank condo while also claiming that home as his primary residence for a $7,000 reduction off of the 1% property tax, FHFA Director William Pulte wrote in the letter to the DOJ, citing media reports. In 2023, the letter continued, a spokesperson for Schiff asserted that "Adam's primary residence is Burbank, California, and will remain so when he wins the Senate seat." FHFA is an independent federal agency that oversees Fannie Mae, Freddie Mac and the Federal Home Loan Bank System. In 2020, Schiff refinanced his mortgage, listing his Maryland home as his secondary residence. Trump publicly slammed Schiff over his mortgages in July on Truth Social, accusing him of fraud and putting the issue back on the public's radar following 2023 news reports on Schiff's homes in Maryland and California. "I have always suspected Shifty Adam Schiff was a scam artist," Trump posted to Truth Social Tuesday. "And now I learn that Fannie Mae's Financial Crimes Division have concluded that Adam Schiff has engaged in a sustained pattern of possible Mortgage Fraud." "Adam Schiff said that his primary residence was in MARYLAND to get a cheaper mortgage and rip off America, when he must LIVE in CALIFORNIA because he was a Congressman from CALIFORNIA. I always knew Adam Schiff was a Crook. The FRAUD began with the refinance of his Maryland property on February 6, 2009, and continued through multiple transactions until the Maryland property was correctly designated as a second home on October 13, 2020." Schiff has repeatedly denied and brushed off the accusations, including refusing to answer questions from Fox News Digital about his alleged mortgage fraud when confronted in the nation's capital on July 16. "Since I led his first impeachment, Trump has repeatedly called for me to be arrested for treason. So in a way, I guess this is a bit of a letdown. And this baseless attempt at political retribution won't stop me from holding him accountable. Not by a long shot," he posted to X in July following Trump's initial Truth Social attack on Schiff's mortgages. "This is just Donald Trump's latest attempt at political retaliation against his perceived enemies. So it is not a surprise, only how weak this false allegation turns out to be. And much as Trump may hope, this smear will not distract from his Epstein files problem," he added. Schiff's primary residence discrepancies first hit the public's radar in 2023, when Schiff launched an ultimately successful campaign to serve in the Senate after decades in the U.S. House. CNN published the first news article detailing that Schiff had claimed the Maryland home as a primary residence while also taking a homeowner's tax exemption on the Burbank condo. The campaign said at the time that Schiff's two properties were listed as primary residences "for loan purposes because they are both occupied throughout the year and to distinguish them from a vacation property." Trump and Schiff have long been political foes, which was underscored during Trump's first administration when Schiff served as the lead House manager during the first impeachment trial against Trump in 2020, and when Schiff repeatedly promoted claims that Trump's 2016 campaign colluded with Russia. Days after Trump first posted about Schiff's mortgages in Maryland and California, the president's Director of National Intelligence, Tulsi Gabbard, declassified documents that reportedly show "overwhelming evidence" that then-President Barack Obama and his national security team laid the groundwork for what would be the yearslong Trump–Russia collusion probe after Trump's election win against former Secretary of State Hillary Clinton in 2016. Schiff was an incredibly vocal lawmaker amid the Russian collusion claims, most notably when the House censured him in 2023 over his promotion that Trump's 2016 campaign colluded with Russia. Schiff served in the House representing California from 2001 to 2024, when he was sworn-in as a senator after his successful 2024 campaign to serve in the nation's upper chamber. Schiff served as the ranking member of the House intelligence committee from 2015 to 2019, before becoming the committee's chair from 2019 to 2023. In that role, he was kept up to date on classified materials surrounding the Russian collusion claims. Trump also recently invoked Gabbard's alleged revelations while attacking Schiff over his mortgages in another Truth Social post. Trump went on to ominously warn during a White House event last week that Schiff has "a lot of other things far worse than" his mortgage inquiry. "He defrauded banks and insurance companies and the federal government, but it's, very simple. It's mortgage loan fraud ... But he has a lot of other things far worse than that. So no Adam Schiff, they have him 100% on mortgage fraud," Trump said last Tuesday from the White House while hosting a meeting with Philippine President Ferdinand Marcos Jr. Jacobson said that Democrats have boxed themselves out of attempting to claim that Trump is targeting a political foe over the mortgage criminal referral because the party had spent the last decade launching "lawfare" at Trump. "One of the ironies here that I think everybody understands, is that Democrats launched a lawfare campaign against Donald Trump. And it didn't just start once he took office this year. It's been going on for a decade," he said. "They have used every tool available to try to destroy him, including through criminal prosecutions, including through federal investigations. . . . They've really tried to get him. And for them now to say, 'oh, just because we did that to you for 10 years doesn't give you the right to do it to us.' Legally, that's sound. I mean, you have to prove your case in court. But politically, I don't think that's going to fly. Democrats screaming that Donald Trump is weaponizing prosecutors against them is not going to really impress a lot of people." Jacobson speculated that there will likely be more woes for Schiff in the coming days, but that potential legal cases hinge on prosecutors. "We don't know where this is going ahead, of course, but it does appear that Adam Schiff is in the sights of Donald Trump. No surprise about that, because Donald Trump has been in the sights of Adam Schiff for a decade. So, I fully expect that there will be more here. The question is going to be really though, once it moves into the realm of prosecution, what are the prosecutors going to do?" The Department of Justice declined comment when approached about potentially investigating and taking up the Schiff case. Schiff's office did not respond to Fox Digital's request for comment.
Fox News
3 days ago
- Business
- Fox News
Could Senator Adam Schiff really go to jail over alleged mortgage fraud?
Federal Housing Finance Agency (FHFA) Director William Pulte sent a criminal referral to Attorney General Pam Bondi in May alleging that California Democrat Sen. Adam Schiff "has, in multiple instances, falsified bank documents and property records to acquire more favorable loan terms, impacting payments from 2003-2019 for a Potomac, Maryland-based property." What is the gist of the complaint? That Schiff, while representing a California district in the House of Representatives, falsely listed his posh Maryland home as his primary residence in order to get more favorable loan terms when, in truth and in fact, his California condo, which he designated as his primary residence in order to qualify for a California homeowner's tax exemption, was his real primary residence. Even worse, according to the referral, Schiff claimed his Burbank condo as his primary/principal residence in California tax filings during the same years he listed his Maryland home as his primary/principal residence on loan applications to finance that home. Schiff's response to the criminal referral and to subsequent Truth Social posts by President Donald Trump was one we often see in white collar cases. Per the senator's office, "the lenders who provided the mortgages for both homes were well aware of then-Representative Schiff's Congressional service and of his intended year-round use of both homes, neither of which were vacation homes." That's not much of a denial, senator. The question is whether you lied on these forms or not. Were your answers accurate or not, and if they were inaccurate, were the answers a mistake or intentional? The devil is always in the details in white-collar cases like this. Which representatives of which particular lenders "were well aware" that Schiff intended to use both homes year-round, and why does that matter? The issue is whether Schiff intentionally lied on federal or state forms to gain a financial advantage. If he falsely listed his Maryland home as his primary residence in order to get a lower interest rate, that matters too. (After all, similar alleged falsehoods by Donald Trump were used by New York Attorney General Letitia James to go after Trump in her massive New York state civil action.) Did Schiff lie on California tax forms to gain an exemption he was not entitled to, and, if so, does it implicate any federal criminal statutes? This is what inquiring minds want to know, and we just don't have enough information at this stage to know all the answers. Based on what we do know, how likely is it that Schiff will be indicted for violating one of several federal bank fraud statutes that potentially cover his conduct? Not very likely. Here are several reasons why: The devil is always in the details in white-collar cases like this. Which representatives of which particular lenders "were well aware" that Schiff intended to use both homes year-round, and why does that matter? This leaves open the possibility of a state of California prosecution for filing false tax returns. Would you care to place any bets on that happening? The bottom line is this: Schiff's alleged conduct may be sleazy and his explanation shifty, but a criminal charge at the federal or state level does not seem to be in the offing.
The Independent
6 days ago
- Business
- The Independent
Texas AG Ken Paxton reportedly declared three primary residences, raising questions of mortgage fraud
Texas Attorney General Ken Paxton and his now-estranged wife, State Senator Angela Paxton, declared multiple homes as their primary residences when applying for home loans, raising questions among experts about mortgage fraud, according to new reports. The Paxtons have long resided in a suburban Dallas home, but also have mortgages on two properties in Austin, the Associated Press reports. Mortgage documents reveal they have declared all three of these houses as their primary residences, according to the outlet. Declaring three homes as primary residences could have saved them money because interest rates on primary homes are lower than those on secondary homes, the Associated Press reports. The Paxtons could have saved hundreds of thousands of dollars, according to The New York Times, which also reported on the documents. It is a crime to knowingly report false statements on mortgage documents, but the cases can be difficult to prove. Experts told the Associated Press it's possible that the Paxtons's lenders prepared the documents and the couple did not carefully review them before signing. 'You have to show they actively knew they were lying and they knew what they were doing,' James C. Spindler, a corporate and securities law professor at the University of Texas at Austin, told the Times. 'That's a high bar.' Arif Lawji, a Texas real estate attorney, argued that the declarations would be 'actionable' if Paxton 'filled out lender documents knowing that they were false.' 'He's the chief enforcement officer,' Lawji told the Associated Press. 'You have to be accountable for stuff you do that's wrong.' Mortgage fraud cases are typically settled out of court through penalties, including bank fees, legal experts told the Times. The Independent has contacted the Paxtons through their respective offices for comment. These reports come two weeks after Angela Paxton filed for divorce and accused her husband of adultery in court documents. The affair first came to light two years ago during Paxton's impeachment trial in the Texas Senate. Paxton was accused of misconduct, corruption and bribery, but the Texas Senate acquitted him of all 16 articles of impeachment. Ken Paxton, a MAGA figurehead, is now running for the U.S. Senate. He'll face off against incumbent Republican Senator John Cornyn in the upcoming primary. Angela Paxton shared a statement on X earlier this month explaining their separation. 'Today, after 38 years of marriage, I filed for divorce on biblical grounds,' she wrote. 'I believe marriage is a sacred covenant and I have earnestly pursued reconciliation.' 'But in light of recent discoveries, I do not believe that it honors God or is loving to myself, my children, or Ken to remain in the marriage,' she said. 'I move forward with complete confidence that God is always working everything together for the good of those who love Him and who are called according to His purpose.' Ken Paxton shared a response minutes later. 'After facing the pressures of countless political attacks and public scrutiny, Angela and I have decided to start a new chapter in our lives,' he wrote. 'I could not be any more proud or grateful for the incredible family that God has blessed us with, and I remain committed to supporting our amazing children and grandchildren,' he added. 'I ask for your prayers and privacy at this time.' The couple met as students and have been married since 1986.
CBS News
6 days ago
- Politics
- CBS News
Texas AG Ken Paxton claimed three homes as primary residence, records show
Texas Attorney General Ken Paxton and his wife, state Sen. Angela Paxton, are longtime owners of a $1.5 million house in a gated community in McKinney. In 2015, they snapped up a second home in Austin. Then another. The problem: Mortgages signed by the Paxtons contained inaccurate statements declaring that each of those three houses was their primary residence, enabling the now-estranged couple to improperly lock in low interest rates, according to an Associated Press review of public records. The lower rates will save the Paxtons tens of thousands of dollars in payments over the life of the loan, legal experts say. The records also revealed that the Paxtons collected an improper homestead tax break on two of those homes at the same time. It is a federal and state crime to knowingly make false statements on mortgage documents. It's also against the law in Texas to collect a homestead tax break on two separate properties. The mortgage revelations are sure to become fodder in the Republican primary for a U.S. Senate seat in which Paxton is seeking to topple the incumbent, John Cornyn. The situation is further complicated by the Trump administration's pursuit of Democrats over similar issues. President Donald Trump has accused two of his political foes — Sen. Adam Schiff of California and New York Attorney General Letitia James — of committing mortgage fraud in similar, though far less serious, circumstances. The Democrats have long been targets of Trump's ire for having led various investigations into his conduct as president and as a business executive. The Justice Department has launched a criminal investigation of James. It received a criminal referral for Schiff last week from the Federal Housing Finance Agency. James' attorney, Abbe Lowell, urged the Trump administration to investigate Paxton instead. "If this administration was genuinely interested in rooting out fraud, it appears they should stop wasting their time on the baseless and discredited allegations against the New York Attorney General James and turn their attention to Texas," said Lowell, a prominent Washington attorney whose past clients include Hunter Biden and Ivanka Trump. In a statement, Marisol Samayoa, a Schiff spokeswoman, blasted the criminal referral as "a transparent attempt" by Trump "to punish a perceived political foe who is committed to holding him to account." It's unlikely that Paxton, a staunch Trump ally, will face the same federal scrutiny as James and Schiff. It's equally doubtful that Paxton will face much legal trouble in Texas: His office is one of the primary agencies tasked with investigating allegations of mortgage fraud. Ken Paxton and his spokesman did not respond to multiple requests for comment. Angela Paxton did not respond to requests made through her office. The Cornyn campaign released a statement Thursday that said in part, "At a time when millions of Americans are fighting to survive under high home mortgage rates, Ken Paxton lied to banks to amass a property empire making him a multimillionaire while on a government salary." Documents reviewed by the AP show the Paxtons hold mortgages on three homes — one in suburban Dallas, two in Austin — that are each listed as their primary residence. The designation comes with a considerable financial upside. Interest rates on primary homes are significantly lower than those for mortgages on secondary homes or investment properties, saving buyers tens of thousands of dollars — if not more — over the life of a loan. Legal experts say it's possible that the Paxtons' lenders prepared the documents and that the couple did not carefully review them before signing. Even if that were the case, some legal experts say that Paxton, as an attorney and Texas' top law enforcement officer, ought to have known better. "If he filled out lender documents knowing that they were false, then that is a false statement to obtain a mortgage on favorable terms. That would be actionable," said Arif Lawji, a veteran Texas real estate attorney. Low interest rates are not the only perk the Paxtons secured, records show. In 2018, they simultaneously collected homestead property tax breaks on their family's home in McKinney, as well as on a $1.1 million home in Austin, property records and tax statements show. A homestead tax break is a property tax reduction that a homeowner is only eligible to collect on one property that is also their primary home. The suburban Dallas home is where the Paxtons' family has long resided. It's where Ken and Angela Paxton are registered to vote. It is located in the state Senate district that Angela Paxton represents in the Legislature, which Ken Paxton held before his election in 2014 to be attorney general. Lawji said the Paxtons' simultaneous collection of two homestead tax breaks appears to be a more clearcut violation. That's because one must obtain a form and submit it to taxing authorities to receive such a tax break, making it an "intentional act," he said. The tax break was worth several thousand dollars, a fact that confounded real estate lawyers. "Why would you try to do all of this," Lawji said, "when you are the attorney general? That's a bigger question to me than the money, when you are AG and have to enforce this law." Paxton's real estate dealings are in many ways distinct from those of James and Schiff, the Democrats targeted by the Trump administration. The investigation of James centers on forms she signed in 2023 while helping a niece buy a home. One form stated that James intended to occupy the home as her "principal residence." But in other documents, the New York attorney general made clear she had no intention of living there. An email to the mortgage loan broker two weeks before she signed the documents stated the property "WILL NOT be my primary residence." For over a decade, Schiff owned homes in Maryland and California, the state he represents, that were both designated as a primary residence. Schiff corrected the issue in 2020 — a step Paxton has not taken. Paxton's real estate dealings are not the first time he has drawn scrutiny for his conduct while in office. He spent roughly 10 years under state indictment on securities charges while serving as the state's top law enforcement official. The charges were eventually dropped in 2024. Other alleged misdeeds led to his impeachment by Texas' GOP-controlled House in 2023. He was acquitted in a trial by the Senate. What ultimately unleashed the impeachment push was Paxton's relationship with Austin real estate developer Nate Paul, who pleaded guilty this year to one count of making a false statement to a financial institution. In 2020, eight top aides in Paxton's office told the FBI they were concerned the state's top law enforcement official was misusing his office to help Paul.
Yahoo
7 days ago
- Business
- Yahoo
Texas AG claimed three homes as primary residence. Democrats are being probed for similar issue
WASHINGTON (AP) — Texas Attorney General Ken Paxton and his wife, Angela, are longtime owners of a $1.5 million house in a gated community outside Dallas. In 2015, they snapped up a second home in Austin. Then another. The problem: Mortgages signed by the Paxtons contained inaccurate statements declaring that each of those three houses was their primary residence, enabling the now-estranged couple to improperly lock in low interest rates, according to an Associated Press review of public records. The lower rates will save the Paxtons tens of thousands of dollars in payments over the life of the loan, legal experts say. The records also revealed that the Paxtons collected an improper homestead tax break on two of those homes at the same time. It is a federal and state crime to knowingly make false statements on mortgage documents. It's also against the law in Texas to collect a homestead tax break on two separate properties. Mortgages have become political fodder The mortgage revelations are sure to become fodder in the Republican primary for a U.S. Senate seat in which Paxton is seeking to topple the incumbent, John Cornyn. The situation is further complicated by the Trump administration's pursuit of Democrats over similar issues. President Donald Trump has accused two of his political foes — Sen. Adam Schiff of California and New York Attorney General Letitia James — of committing mortgage fraud in similar, though far less serious, circumstances. The Democrats have long been targets of Trump's ire for having led various investigations into his conduct as president and as a business executive. The Justice Department has launched a criminal investigation of James. It received a criminal referral for Schiff last week from the Federal Housing Finance Agency. James' attorney, Abbe Lowell, urged the Trump administration to investigate Paxton instead. 'If this administration was genuinely interested in rooting out fraud, it appears they should stop wasting their time on the baseless and discredited allegations against the New York Attorney General James and turn their attention to Texas,' said Lowell, a prominent Washington attorney whose past clients include Hunter Biden and Ivanka Trump. In a statement, Marisol Samayoa, a Schiff spokeswoman, blasted the criminal referral as 'a transparent attempt' by Trump 'to punish a perceived political foe who is committed to holding him to account.' It's unlikely that Paxton, a staunch Trump ally, will face the same federal scrutiny as James and Schiff. It's equally doubtful that Paxton will face much legal trouble in Texas: His office is one of the primary agencies tasked with investigating allegations of mortgage fraud. Ken Paxton and his spokesman did not respond to multiple requests for comment. Angela Paxton, who is a state senator in Texas, did not respond to requests made through her office. Three of the Paxtons' homes are each listed as a primary residence Documents reviewed by the AP show the Paxtons hold mortgages on three homes — one in suburban Dallas, two in Austin — that are each listed as their primary residence. The designation comes with a considerable financial upside. Interest rates on primary homes are significantly lower than those for mortgages on secondary homes or investment properties, saving buyers tens of thousands of dollars — if not more — over the life of a loan. Legal experts say it's possible that the Paxtons' lenders prepared the documents and that the couple did not carefully review them before signing. Even if that were the case, some legal experts say that Paxton, as an attorney and Texas' top law enforcement officer, ought to have known better. 'If he filled out lender documents knowing that they were false, then that is a false statement to obtain a mortgage on favorable terms. That would be actionable,' said Arif Lawji, a veteran Texas real estate attorney. Low interest rates are not the only perk the Paxtons secured, records show. In 2018, they simultaneously collected homestead property tax breaks on their family's home in suburban Dallas, as well as on a $1.1 million home in Austin, property records and tax statements show. A homestead tax break is a property tax reduction that a homeowner is only eligible to collect on one property that is also their primary home. The suburban Dallas home is where the Paxtons' family has long resided. It's where Ken and Angela Paxton are registered to vote. It is located in the state Senate district that Angela Paxton represents in the Legislature, which Ken Paxton held before his election in 2014 to be attorney general. Lawji said the Paxtons' simultaneous collection of two homestead tax breaks appears to be a more clearcut violation. That's because one must obtain a form and submit it to taxing authorities to receive such a tax break, making it an 'intentional act,' he said. The tax break was worth several thousand dollars, a fact that confounded real estate lawyers. 'Why would you try to do all of this,' Lawji said, 'when you are the attorney general? That's a bigger question to me than the money, when you are AG and have to enforce this law.' Schiff and James come under fire from GOP Paxton's real estate dealings are in many ways distinct from those of James and Schiff, the Democrats targeted by the Trump administration. The investigation of James centers on forms she signed in 2023 while helping a niece buy a home. One form stated that James intended to occupy the home as her 'principal residence.' But in other documents, the New York attorney general made clear she had no intention of living there. An email to the mortgage loan broker two weeks before she signed the documents stated the property 'WILL NOT be my primary residence.' For over a decade, Schiff owned homes in Maryland and California, the state he represents, that were both designated as a primary residence. Schiff corrected the issue in 2020 — a step Paxton has not taken. Paxton's real estate dealings are not the first time he has drawn scrutiny for his conduct while in office. He spent roughly 10 years under state indictment on securities charges while serving as the state's top law enforcement official. The charges were eventually dropped in 2024. Other alleged misdeeds led to his impeachment by Texas' GOP-controlled House in 2023. He was acquitted in a trial by the Senate. What ultimately unleashed the impeachment push was Paxton's relationship with Austin real estate developer Nate Paul, who pleaded guilty this year to one count of making a false statement to a financial institution. In 2020, eight top aides in Paxton's office told the FBI they were concerned the state's top law enforcement official was misusing his office to help Paul. Brian Slodysko, The Associated Press Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
