Former Miami-Dade County Resident Sentenced to More than 8 Years in Prison for Bank Fraud and Money Laundering Schemes

A former Miami-Dade County resident was sentenced by U.S. District Court Judge Cecilia M. Altonaga to 97 months in prison, to be followed by five years of supervised release, and was ordered to pay $722,000 in restitution for his roles in bank fraud and money laundering schemes.

Ariana Fajardo Orshan, United States Attorney for the Southern District of Florida, Michael J. De Palma, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Katherine Fernandez Rundle, Miami-Dade State Attorney, Miami-Dade State Attorney’s Office, Juan J. Perez, Director, Miami-Dade Police Department (MDPD), and Adolphus P. Wright, Special Agent in Charge, U.S. Drug Enforcement Administration (DEA), Miami Field Division made the announcement.

Jose Orlando Sanchez Cristancho, a/k/a Orlando Sanchez, 57, a citizen of Colombia who formerly resided in Miami-Dade County, previously pled guilty to one count of conspiracy to commit wire and bank fraud, in violation of Title 18, United States Code, Section 1349, and one count of conspiracy to launder money, in violation of Title 18, United States Code, Section 1956(h).

According to court documents, from 2003 through 2011, Sanchez agreed with other co-defendants to purchase condominium apartments and other real estate in South Florida. Their intention was to obtain mortgage loans on the properties through schemes that would enable them to profit from the loans, or the sales of the property, without having to re-pay the loans.

One of the schemes included recruiting a straw buyer to purchase property (at an inflated price) that Sanchez already owned. Sanchez arranged for the straw buyer to submit a loan application to a bank which he knew was entirely false. Sanchez knew the bank, insured by the FDIC, would rely on it in extending the loan. Sanchez went forward with the sale, and signed a HUD-I form used at the closing which he knew contained false statements about the finances of the purchase. When the purchase closed, Sanchez netted more than $400,000 from the transaction, which he obtained from the loan proceeds the buyer had obtained through the fraudulent application. The straw buyer defaulted on the loan obtained at Sanchez's direction, but Sanchez was able to keep the money the straw buyer had paid him from the loan proceeds. When the property was eventually sold in a short sale, the bank had a loss of $404,000.

In a different scheme, Sanchez applied for a mortgage loan from an FDIC-insured financial institution for the purpose of buying an apartment in Aventura, Florida. He submitted a loan application and then a HUD-I closing form with false statements. Approximately 1 ½ years after the purchase, Sanchez stopped making payments on the loan and the bank began foreclosure proceedings. The property was subsequently sold in a short sale for a loss to the bank of approximately $106,000.

The frauds perpetrated by Sanchez and his co-conspirators resulted in Sanchez receiving in in excess of $1 million from FDIC-insured financial institutions. Losses to those institutions totaled approximately $722,000.

During a prior  time period, Sanchez had acquired substantial real estate and money in Colombia from the trafficking of cocaine. Sanchez transferred approximately $1.3 million in drug-derived assets to the United States that he used for numerous real estate purchases and for living expenses. Sanchez laundered his drug proceeds by moving them through numerous bank accounts belonging to co-conspirators and accomplices, and by buying property through shell corporations, in order to disguise the nature and source of his money.

Co-defendants Andrea Marroquin and Luis Fernando Reyes were arrested in Colombia and are in the process of being extradited to the United States. Co-defendant Sergio Hernan Perdomo Lievano remains a fugitive.  An indictment is merely an allegation, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law. 

This case is the result of the ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.

Mrs. Fajardo Orshan commended the investigative efforts of IRS-CI, the Miami-Dade State Attorney’s Office, MDPD, and DEA.  This case was prosecuted by Assistant U.S. Attorney Frank H. Tamen.

Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov.