In a case highlighting a fraud risk for mortgage companies and other financial institutions, two Garden State residents were sentenced for using fake money orders attempting to fraudulently discharge debts.
Sentenced to more than four years in prison in Newark federal court on Tuesday were Germaine Howard King, aka Germaine Howard, 47, of Elizabeth, and Daniel D. Dxrams, aka Danny D. Dxrams or Daniel Kusi, 41, of Maplewood, according to a press release issued by the U.S. Attorney’s office.
King, who also was sentenced to an additional five years of supervised release and restitution of $597,781, was convicted for defrauding banks and other lenders using the phone money orders, including one in an attempt to pay off a $400,000 mortgage.
An unnamed financial institution initially credited the mortgage as a payoff, and then later needed to go to court to attempt to reinstate the debt, according to documents filed in the case and used in evidence at trial.
Both men also were convicted on charges related to their involvement in a scheme to fraudulently pay off loans for high-end cars, and Dxrams was additionally convicted by bankruptcy fraud and making a false oath during a bankruptcy proceeding.
In one instance of the two men’s attempts to fraudulently pay off car loans, the phony money orders were mailed to an unnamed credit union. Although the credit union rejected the money orders, the two men continued to claim falsely in correspondence that they had paid off the debt.
In addition to the prison term, Dxrams’ sentence includes three years of supervised release, restitution of $93,236, and forfeiture of $82,000.
Steps financial institutions can take to help prevent money-order fraud include verifying the availability of funds and veracity of documents with legitimate vendors like Western Union or MoneyGram, according to a 2019 Experian report on the topic.
Financial institutions also should be on the lookout for tampering with the amount line and unusual urgency for processing on the customer’s part.
