AG: Carey stole $2M

By George P. Hassett

A former Somerville real estate attorney was indicted Friday for allegedly stealing $2 million in what authorities are calling a “mortgage stacking” scheme.

Kevin Carey, 48, of Middleboro, continually refinanced the loans on four properties he or his family members owned without paying off the existing loans, authorities said. He was the agent for a New England title insurance company, which allegedly allowed him to issue title insurance policies on the mortgage transactions he processed and hide the existing loans.

Carey allegedly “stacked” three mortgages on a home in Medford, four mortgages on two homes in Everett and one mortgage on his personal home in Medford between April 2002 and September 2004. He also falsified loan applications by omitting his other mortgages and signed a family member’s name on false mortgage applications and closing documents he created, according to the Attorney General Martha Coakley’s office.

When he received the loan money, Carey didn’t pay off his existing mortgages, but instead used the cash to line his own pockets, according to authorities.

Carey stole over $2 million in the scheme, authorities said.

Investigators from the Attorney General’s office believe that the lenders remained unaware of Carey’s scheme because he continued to make monthly payments on all of the loans, authorities said. In November 2005, a database search by Fannie Mae flagged the multiple mortgages on one of the properties, triggering a notification to one of the lenders. The lender then notified the title insurance company of the problem. Lawyers for the title insurance company then referred the matter to the Attorney General’s office in March 2006.

He is charged with larceny over $250 and willfully making a false statement regarding financial condition or assets. His lawyer Dan O’Malley would not comment on the charges.

Before allegedly engaging in mortgage fraud, Carey was the city‚Äôs water commissioner under former Mayor Dorothy Kelly Gay from July 1999 to January 2001.