NRI Vijay Taneja jailed 7 years for mortgage fraud scheme

 

Virginia, Jan 31, 2009
Kulbir Singh

NRI Vijay K. Taneja, 48, of Fairfax, Virginia was sentenced 7 years in jail on Friday for defrauding banks of $33 million. It was one of the largest bank fraud scams in the Virginia state's history. He also cheated NRIs with phony home loans.

U.S. District Court Judge Claude Hilton could have been sent him 20 years in jail, but Taneja has cooperated extensively with the government. He was ordered to pay $33 million in restitution to the four banks he swindled in a complicated mortgage fraud scheme.Taneja is in bankruptcy and restitution order requires Taneja to make payments of $300 a month after he is released from prison.

Prosecutor Stephen Learned said:

• It was the largest bank fraud scheme prosecuted at the courthouse in at least 20 years, in which four banks lost about $33 million- Franklin bank, First Tennessee Bank, Wells Fargo bank and a J.P. Morgan Chase and Co. subsidiary called EMC Mortgage Co.
• He defrauded the banks by creating fictitious loans and mortgages, and then selling them to investors
• Some cases, he sold legitimate mortgages to multiple banks

Taneja before the federal judge said:

• He apologized for his actions, the embarrassment to his family and the aggravation to his victims.
• He reportedly admitted his entertainment ventures, which included numerous Indian musical acts in the Washington area, were funded by an extensive mortgage fraud scheme.

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On November 13, 2008, he appeared in U.S. District Court in Arlington, Virginia, entered his plea to one count of conspiracy to commit money laundering and pleaded guilty

According to the Court documents, Taneja operated the scheme and conspired with the owner of TitlePro, a Fairfax title company that went out of business in May of 2008. The prosecutors said:

• He invested money into Indian films from his mortgage operation. His Elite Entertainment company financed the various productions.
• He has millions of dollars unaccounted and difficult to figure out where it all went.

A lawyer appointed as the trustee in Taneja's bankruptcy case, H. Jason Gold said:

• Dozens of individuals suffered financial losses. In some cases, victims appear to have unwittingly signed promissory notes that were included in the reams of paperwork that accompany mortgage closings.
• Dozens and Dozens of people were defrauded or lost money. It's the little people who in reality get hurt the most.
• The scheme ran from 2001 through June, when Taneja's company, Financial Mortgage, Inc., filed for bankruptcy.

Several area residents were victimized, their credit rating has been damaged and credit cards have been canceled because he sold their mortgage to three different banks, all of whom wanted to be paid. Many mortgagees were reportedly duped into signing a second set of loan documents.

Robert Trout, Taneja's defense lawyer said:

• His client never intended to harm anyone and always intended to pay the money back. He called Taneja's actions "a misguided effort for bridge financing
• The scheme collapsed when "the balls could no longer be juggled.

Vijay K. Taneja:

NRI Vijay K. Taneja, a U.S. citizen, a real estate developer and immigrated to the US at age 10 when his diplomat father was posted here. He worked at several banks and established Fairfax, Virginia-based Financial Mortgage, Inc., (FMI) in 1990.

Financial Mortgage, Inc., -outsource closing coordination, title and escrow, post-closing and sub servicing vendor coordination and delivery to Guardian Mortgage Services (GMS) in order to better manage fixed costs.

Elite Entertainment:

He invested millions in Bollywood films and brought Indian entertainment shows to the Washington area. He was very popular in the NRI community and a flashy movie producer. He established Elite Entertainment, Inc.in Virginia

The biggest celebrities from the Indian Bollywood industry have performed in live concerts since 1993, Stars like Amitabh Bachan, Shahrukh Khan, Hritik Roshan, Madhuri Dixit, Aishwarya Rai, Preity Zinta, Rani Mukherjji, Arjun Rampal, Lara Dutta, Fardeen Khan, Aftab Shivdasani, Salman Khan, Sunjay Dutt, Amer Khan, Saif Ali Khan, Adnan Sami, Jagjit Singh, Sonu Nigham, A. R. Rahman and group and many more.

Elite Entertainment started as a local promoter in Washington DC Metropolitan area then later started in on the international level of bringing the Bollywood actors/stars to UK, USA, Canada and selling the shows to applicable local promoters. Elite has maintained the excellent reputation with the type of talent brought overseas and India (Bollywood stars).

A civil suit filed against Taneja alleges the fraud was motivated in part by a desire to raise money for the production of "Aap Kaa Surroor," which carried a budget of $16.5 million — very large by Bollywood standards.

Two films "Humko Tumse Pyaar Hai" and "Aap Kaa Surroor: The Moviee were produced in 2006 and 2007 by him. The Real Luv Story" — were major Bollywood releases that featured established stars including Arjun Rampal, Bobby Deol, Himesh Reshammiya and Malika Sherawat, said Priya Jaikumar, an associate professor at the University of Southern California's School of Cinematic Arts.

A Bollywood producer, is already claiming the rights to the film. In fact, he already chose the film’s location –- a U.S. federal court just outside Washington, D.C.

The problem is Taneja is also starring in this movie –- as himself

He also donated large amounts to Hindu temples.

He built a palatial home, 25,000-Square-Foot white Mansion. Tennis Court. Indoor Pool. Gold-Leaf Prayer Room in 2003. This home was sold for $3.9 million under his bankruptcy proceedings.

He filed for bankruptcy in debt of $77 million

Photo- courtesy of buzzine.co

• By his largest bank fraud, four banks lost about $33 million
• He produced two films in 2006 and 2007:
  • Humko Tumse Pyaar Hai
  • Aap Kaa Surroor
• He built a palatial home in 2003 and sold for $3.9 million under his bankruptcy proceedings. He filed for bankruptcy in debt of $77 million