Former No. Castle GOP Chair Indicted on 19 Counts
Former North Castle Republican Chairwoman Loronda Murphy was indicted on 19 counts stemming from her role in an alleged mortgage fraud scheme that fleeced her victims out of at least $250,000, District Attorney Janet DiFiore announced on Thursday.
Murphy, 47, was charged with 10 counts of falsifying business records in the first degree, five counts of second-degree grand larceny and one count each of residential mortgage fraud in the first and second degree and of a scheme to defraud, all felonies. The lone misdemeanor charge was a fifth-degree conspiracy charge.
From April through June 2009, Murphy, operating under the home mortgage closing company Settle One Corp. located at 428 Main St. in Armonk, and real estate attorney Scott Forcino, are accused of engaging in what DiFiore described as a home mortgage Ponzi scheme. DiFiore said that the pair stole at least $50,000 from each of five victims, including Murphy’s elderly father, Paul Cartularo Sr.
Forcino, 45, of New Rochelle, was also indicted on three counts: first-degree scheme to defraud and fourth-degree criminal facilitation, both felonies, and conspiracy in the fifth-degree, a misdemeanor.
“This type of criminal activity is what contributed to the general collapse of the nation’s residential housing market,” DiFiore said in a prepared statement on Thursday following the defendants’ arraignments. “These defendants, one a former town political leader and the other an officer of the court, built a corrupt enterprise abusing the lending process and defrauding their victims. The scheme carried out by these defendants, solely for their own personal financial gain, not only harmed the targeted individuals and lending institutions, but also had the potential to undermine the housing market in the areas where they operated their scheme.”
In September 2010, search warrants were executed at Murphy’s Armonk residence and at the offices of the North Castle Republican Committee, located on Maple Avenue in Armonk at the time. The raids led to an 11-month investigation by the district attorney’s office and the Town of North Castle police, culminating in the indictments.
Murphy vacated the town’s Republican Committee chair shortly after the raids when it also came to light she had been arrested for mortgage fraud in Suffolk County in February 2010. She is still awaiting trial on that charge.
The Westchester scheme targeted homeowners who each took out a new mortgage on their home through Settle One with the understanding that Forcino would oversee the closing and that money from the new mortgage would pay off the pre-existing mortgage, district attorney spokesman Lucien Chalfen said.
However, Forcino allowed Murphy to fraudulently assume the role of attorney for each closing. Instead of paying off the pre-existing mortgage, Murphy allegedly stole portions of the new loan money, leaving the victims the unsustainable burden of having simultaneous mortgages.
Murphy allegedly orchestrated the preparation and submission of a series of false mortgage documents in connection with the five loan closings that resulted in the deposit of more than $1 million into the Settle One bank account that she had access to from home mortgage lenders Wells Fargo Bank and Live Well Financial.
Chalfen did not reveal how much money Murphy is accused of stealing in total but said at least $50,000 was taken from each victim. He said most of the $1 million had been taken. Second-degree grand larceny involves thefts of more than $50,000 but less than $1 million.
Murphy also attempted to conceal her crimes by using money left in the Settle One bank account to make monthly mortgage payments on several unpaid mortgages, Chalfen said. In some cases, Murphy even stole one homeowner’s new mortgage loan money and used it to pay off another homeowner’s previously unpaid mortgage.
In Suffolk County, Murphy allegedly used $341,453.30 in mortgage proceeds belonging to a Smithtown, L.I. couple to satisfy other mortgages in July 2009. The Smithtown couple had refinanced their mortgage through a company called IMC Mortgage, which was operating out of the same Armonk address as Settle One Corp.
Murphy faces a maximum of five to 20-year sentence on the top count of her indictment while Forcino could serve 15 months to four years if convicted.
Bail was set at $100,000 bond for Murphy and $5,000 cash for Forcino. Chalfen said that Murphy has been released after making bail.
Their next court appearance is scheduled for Sept. 15.
Martin has more than 30 years experience covering local news in Westchester and Putnam counties, including a frequent focus on zoning and planning issues. He has been editor-in-chief of The Examiner since its inception in 2007. Read more from Martin’s editor-author bio here. Read Martin’s archived work here: https://www.theexaminernews.com/author/martin-wilbur2007/