Date: October 21, 2022 Contact: email@example.com BOSTON — A Salem, Massachusetts real estate developer was sentenced to four years in prison today in connection with a decade-long mortgage fraud scheme involving at least two dozen loan transactions, totaling $6.5 million, that resulted in more than $3.8 million in losses to lenders. George Kritopoulos was sentenced by U.S. District Court Judge Patti B. Saris to four years in prison to be followed by two years of supervised release. The judge reserved determination on an order of restitution. On May 27, 2022, Kritopoulos was convicted by a federal jury of one count of conspiracy, two counts of wire fraud, six counts of bank fraud, one count of aiding the preparation of a false income tax return and one count of obstruction of justice. Kritopoulos was originally charged in September 2018 along with co-defendants Joseph Bates III and David Plunkett. Bates pleaded guilty to one count of conspiracy, three counts of wire fraud affecting a financial institution and two counts of bank fraud in October 2018 and is scheduled to be sentenced on Dec. 1, 2022. Plunkett pleaded guilty to one count of bank fraud and one count of aiding in the submission of false tax returns in February 2019 and is scheduled to be sentenced on Dec. 14, 2022. From 2006 through 2015, Kritopoulos, Bates and others engaged in a scheme to defraud banks and other financial institutions by causing false information to be submitted to those institutions on behalf of borrowers – people recruited to purchase properties – located primarily in Salem. The properties were usually multi-family buildings with two-to-four units, which the conspirators then converted into condominiums. Kritopoulos recruited new borrowers to purchase the individual condominium units, which were also financed by mortgage loans obtained by fraud. The false information submitted to lenders included, among other things, representations concerning the borrowers' employment, income, assets and intent to occupy the property. Specifically, the false employment information included representations that borrowers were employed by entities that were, in fact, shell companies "owned" by Kritopoulos and were used to advance the fraudulent scheme. The employment information also included false representations about the income that the borrowers received from the entities, when, in fact, the borrowers received little or no income from them. Kritopoulos brought newly recruited borrowers to Plunkett, who then prepared tax returns that contained false and inflated income. Some of those tax returns were submitted to lenders in support of the fraudulent loan applications. Since the borrowers did not have the financial ability to repay the loans, in all but two instances among 21 properties, they defaulted on their loan payments, resulting in foreclosures and losses to the lenders. In addition, Kritopoulos sought to obstruct the federal criminal investigation into the mortgage fraud scheme by encouraging Bates and Plunkett to make false statements and create false documents he hoped would make the companies appear to have been legitimate. United States Attorney Rachael S. Rollins; Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service – Criminal Investigation Division, Boston Office; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; and Christina Scaringi, Special Agent in Charge of the U.S. Department of Housing and Urban Development, Office of Inspector General, Northeastern Regional Office made the announcement today. Valuable assistance was provided by the Salem Police Department. Assistant U.S. Attorneys Victor A. Wild, of Rollins' Securities, Financial & Cyber Fraud Unit, and Brian M. LaMacchia, of Rollins' Affirmative Civil Enforcement Unit prosecuted the case.