Former Bergen County Improvement Authority chairman Ronald J. O’Malley was sentenced to two years in prison Tuesday for a mortgage fraud scheme that falsely claimed mortgage borrowers worked at the county’s public financing agency, U.S. Attorney Paul Fishman said.
O’Malley, 48, a principal in Ridgewood-based mortgage brokerage firm Diversified Financial Group, was also hit with a $25,000 fine imposed by U.S. District Judge Dennis M. Cavanaugh.
O’Malley and his coconspirators arranged for phony paystubs and W-2 forms to show borrowers worked at the BCIA, federal prosecutors said. O’Malley and others also arranged for agency staff to confirm the bogus information to banks and lenders calling to confirm the information.
Former Diversified Financial Group employee Laura-Jean Arvelo, 52, of River Vale, was also sentenced to two years probation, prosecutors said. to a count of conspiracy to commit wire fraud.
The defendants admitted they conspired with the Ridgewood firm’s co-owner 48-year-old Edward Olimpio, of Boonton, and employees Daniel Gilmore, 31, of Hackensack, and 30-year-old River Edge resident Rachell Fischbein, in the scheme between 2006 and 2009, prosecutors said. The three previously pleaded guilty and are awaiting sentencing.
“O’Malley and his coconspirators also made false representations regarding borrowers’ employment at places other than the BCIA, and created similar false documentation in support of such claims,” the U.S. Attorney’s Office said in a statement. “The coconspirators also created false asset information for borrowers, including by taking O’Malley’s own bank and brokerage account statements and ‘cut-and-pasting’ a borrower’s name and address over his own.”
In letters, supporters urged the judge to consider O’Malley’s contributions to the community, northjersey.com reported. Among those who stood by the former BCIA official was Dumont mayor Matthew P. McHale.