Man gets imprisoned for selling $18M worth of fake Detroit homes

A Florida man will be out behind the bars for tricking the people countrywide into selling $18M worth of fake Detroit homes.

According to Archy Newsy, 38-year-old Frederick Haden, from Florida will be imprisoned for more than four years. He has been held guilty for defrauding hundreds of individuals nationwide into purchasing houses in Detroit that didn't really exist. He managed to acquire $18 million by fooling them via telephone communication.

On Tuesday, the man has been announced with an imprisonment of 52 weeks by U.S. District Judge Stephen Murphy. Federal prosecutors stated that he had participation in a telemarketing plan that fooled around 290 individuals from 47 states and Canada.

This is how telemarketers defrauded victims. They made unrequested calls to the unfortunate ones, telling them that the bank owned the houses in Detroit. They offered the victims to purchase the houses with much lower amount than their original worth.

The unsuspected victims were also given full guarantee by the phone callers that they can re-sell the properties and that the blocks of houses are already eyed by multiple funds and foreign traders.

To gain their trust and to see how the process works, the telemarketers made a deal by encouraging them to purchase a single home. Once the victims buy it, they made it appear that the property was quickly sold for a profit, as mentioned by Detroit Free Press. In reality, it was transferred to another company for no money.

Prosecutors also said that some victims suffered a huge setback as they got convinced to invest in more than one property. The role of Haden was developed gradually with time as initially he worked as a "fronter", who makes convincing calls to the victims to buy houses in Detroit. Later on, he decided to protect his plan from being unveiled by associating the names of various companies.

His bank records revealed the amount of $100,000, which he snatched by fooling through check and wire transfers. An illegal operation helped Haden for his lavish lifestyle by purchasing a motorcycle along with a Cadillac.

"Any scheme to defraud is reprehensible," U.S. Attorney Barbara McQuade said. "But this scheme is particularly egregious because it undermines efforts to revitalize real estate investment in Detroit."

McQuade mentioned in a statement that Detroit has multiple good real estate investment opportunities, but the investors should "always do their homework first." as reported by USA Today.

"This individual was part of a criminal enterprise that committed fraudulent acts that bilked investors of millions of dollars and drove legitimate investors away from the city, further damaging recovery efforts in Detroit," said David P. Gelios, Special Agent in Charge, FBI-Detroit Division.

16 defendants including Haden are arrested for the illegal scheme. Twelve defendants are held guilty and the fate of four others is suspended till March.