Two former loan officers at NJ Lenders Corp. charged for role in mortgage fraud

New Jersey's top loan officer based on volume and his former assistant have been charged for their involvement in a mortgage fraud scheme, the U.S. Department of Justice said.

Christopher Gallo, 44, of Old Tappan in Bergen County, and his former assistant Mehmet Elmas, 32, a U.S. citizen who lives in Turkey, were each charged with one count of conspiracy to commit bank fraud. They appeared Wednesday before U.S. Magistrate Judge André M. Espinosa in Newark federal court and were each released $200,000 unsecured bond.

The Justice Department, citing court documents and statments made in court, said from 2018 through October 2023 Gallo and Elmas were involved in a scheme to falsify loan origination documents sent to different mortgage lenders including their former employer to get mortgage loans approved fraudulently. They are also accused of fraudulently obtaining cheaper mortgage rates by not disclosing that the mortgage loans were intended for the purchase of rental or investment properties, as opposed to primary residential homes.

Since 2020, Gallo has been the top loan officer in New Jersey based on sales volume, according to Scotsman Guide, a national publication about the mortgage industry. From 2021 through 2022, he was nationally ranked in the 4th position by the same publication. Between 2018 and 2023, Gallo originated more than $1.4 billion in loans, according to court documents.

The fraud scheme was allegedly performed while Gallo and Elmas worked for NJ Lenders Corp., a New Jersey mortgage loans company.

“NJ Lenders is proud of its 33 years of successfully assisting homeowners with integrity and professionalism. We are fully cooperating with law enforcement and the ongoing investigation of two former employees,” NJ Lenders Corp. attorney Mark Tabakin told HousingWire.

“The actions of these former employees appear to have been coordinated to benefit them financially while taking advantage of the reputation and trust of the firm,” he added.

The conspiracy count also includes falsifying property records such as building safety and financial information of prospective borrowers to facilitate mortgage loan approval.

Conspiracy to commit bank fraud charge carries a maximum penalty of 30 years in prison and a $1 million fine, or twice the gross gain or loss from the offense, whichever is greatest.

The Justice Department said charges and allegations contained in the complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty.

This article originally appeared on Asbury Park Press: Top NJ loan officer and assistant charged for role in mortgage fraud