Orlando Realtor Rafael Sanchez Admits to Bankruptcy Scam

ORLANDO, FL – Rafael Sanchez, 69, of Orlando, Florida, has pleaded guilty to a calculated bankruptcy fraud scheme designed to line his pockets while preying on vulnerable homeowners facing foreclosure. The announcement came today from United States Attorney A. Lee Bentley, III, confirming Sanchez’s admission of guilt in federal court.

Sanchez, a licensed real estate broker, isn’t accused of simply bad business; he’s accused of deliberately sabotaging the legal rights of creditors and federal agencies. According to the plea agreement, Sanchez concocted a short-sale scheme to defraud those holding lawfully recorded mortgage notes, as well as Fannie Mae and the Federal Housing Administration (FHA), which backed the mortgages. He specifically targeted distressed homeowners desperate to save their homes, offering a false promise of relief.

The scheme revolved around filing fraudulent bankruptcy petitions on behalf of these homeowners. These weren’t legitimate attempts to restructure debt; they were deliberately bogus filings designed to invoke the automatic stay provision of federal bankruptcy law. This legal maneuver immediately halted any foreclosure actions, buying Sanchez time and allowing him to orchestrate short sales – and collect commissions – while creditors were legally barred from acting.

Sanchez profited handsomely from this deception. He raked in real estate commissions from the short sales of the distressed properties during the period the automatic stay was in effect, essentially stealing opportunity from those legitimately owed money. The full extent of his ill-gotten gains is still being tallied, but Sanchez has agreed to make full restitution to the Clerk of Court for the United States Bankruptcy Court for the Middle District of Florida.

Federal investigators from the Federal Bureau of Investigation, the Federal Housing Finance Agency – Office of Inspector General, the U.S. Department of Housing and Urban Development – Office of Inspector General, and the Office of the U.S. Trustee in Orlando painstakingly untangled the web of fraudulent filings. The case is being prosecuted by Special Assistant United States Attorney Chris Poor and Assistant United States Attorney James Mandolfo, who will now seek a sentence of up to five years in federal prison for Sanchez.

Sanchez is scheduled to be sentenced on January 9, 2017. This case serves as a stark reminder that exploiting the bankruptcy system for personal gain will not be tolerated, and those who prey on vulnerable homeowners will face the full weight of federal prosecution.