Vito Grippo, 58 of Jackson and owner of Morgan Financial Equity Shares and Vanick Holdings on Holmdel Road plead guilty to mortgage fraud after being indicted in December.
As described by Grippo and his associates, the Equity Share Program involved creating a limited liability company (“LLC”) in the name of the homeowner’s house in which LLC the homeowner would supposedly own a 90 percent interest with the rest to be owned by one or two private investors.
In reality, the so-called investors invested nothing and were instead straw buyers recruited by Vito Grippo or his son, Frederick “Freddie” Grippo because they had good credit. The Grippos and their associates then made out mortgage loan applications in the names of the “investors” for the purchase of the properties owned by the homeowners in distress. Freddie Grippo pleaded guilty before Judge McNulty on Nov. 28, 2012, to conspiracy to commit wire fraud.
A homeowner in distress would come to a closing in Vito Grippo’s office and be given a stack of documents to sign. The homeowners would be led to believe the documents would prevent foreclosure and frequently did not understand that they would be transferring title to their homes to the “investor.”
The so-called investor was, in reality, a straw buyer of the homeowner’s house. The new mortgage loan applications filled out by the Grippos or their associates in the name of one of the investors contained materially false information about the loan applicant’s monthly income, his assets and whether the residence to be bought would be his primary residence.
Vito Grippo did not report $289,780 in gross income from the activities of Vanick Holdings LLC for the 2006 tax year. For the year 2007, he did not report $213,261. For the year 2008, he did not report $1,366,261.
The conspiracy count with which Vito Grippo is charged is punishable by a maximum potential penalty of 30 years in prison and a fine of $1,000,000. Each of the three tax charges carries a maximum potential penalty of three years in prison and a fine of $100,000.
Grippo pleaded guilty to one count of conspiracy to commit wire fraud, two counts of filing a false tax return for the years 2006 and 2007, and one count of aiding and procuring the filing of a false tax return for the year 2008, according to the USDOJ.
John Pereless, 44, of Colts Neck is also alleged to have conspired with Vito Grippo in connection with four of the 12 home sales with which Grippo is charged, and had pleaded guilty in July before a Superior Court Judge on two counts of second-degree theft by deception for filing fraudulent mortgage loan applications and stealing $661,261 in equity due to home sellers in connection with 14 homes, including the four transactions involving Vito Grippo.