A $2.5 million Florida reverse mortgage ring built on inflated appraisals
From May 2009 through November 2010, Louis Gendason and three co-defendants at a Florida mortgage company and a Pennsylvania title company solicited homeowners aged 62 and older into reverse mortgages, using appraisals Gendason altered to fraudulently inflate home values so borrowers who did not actually have enough equity would qualify. Genworth Financial Home Equity Access approved, and the FHA insured, more than $2.5 million in loans built on the falsified paperwork. All four defendants were convicted and sentenced to federal prison between November 2011 and January 2012.
- Year
- 2012
- Where
- United States
- Outcome
- Sentenced
- Reported loss
- $2.5 million
- Victims
- Not stated in the sources
- Schemes
- Reverse mortgage scams
- Last reviewed
- 2026-10-01
The facts, as recorded
- Louis Gendason and John Incandela worked as loan officers at 1st Continental Mortgage in Florida; Marcos Echevarria was also a loan officer on the scheme; Kimberly Mackey was a licensed title agent and proprietor of Real Estate One Land Services, Inc. in Pennsylvania.
- Gendason altered real estate appraisals to fraudulently inflate the value of borrowers' properties so that homeowners without sufficient equity could qualify for a reverse mortgage.
- Based on the falsified documentation, Genworth Financial Home Equity Access approved, and the Federal Housing Administration insured, more than $2,572,813 in reverse mortgage loans between May 2009 and November 2010.
- Mackey closed loans without paying off the borrowers' existing mortgages as represented and created false HUD-1 settlement statements to conceal that the transactions did not match what borrowers were told.
- At least $998,086.33 of the loan proceeds was diverted into an account controlled by Gendason and Incandela.
- Gendason, identified by prosecutors as the scheme's mastermind, was sentenced on January 20, 2012 to 70 months in prison, five years of supervised release, and more than $2 million in restitution by US District Judge William P. Dimitrouleas in Fort Lauderdale.
- Mackey was sentenced to 60 months on November 3, 2011; Echevarria was sentenced to 24 months the same day; Incandela, who pleaded guilty in August 2011, was sentenced on December 20, 2011 to 41 months and over $1.9 million in restitution.
- US Attorney Wifredo A. Ferrer said of the scheme: "This scheme robbed elderly homeowners of their homes and the American dream."
Why this case matters
This is the clearest documented case of a coordinated loan-officer ring, rather than a single operator, deliberately falsifying the one document, the appraisal, that stands between an ineligible borrower and a federally insured reverse mortgage. It shows how little due diligence from the lender’s side was needed once the paperwork looked right.
The appraisal was the fraud
Reverse mortgage eligibility depends on having enough home equity. Gendason’s alteration of appraisals did not create fake homes or fake borrowers, it manufactured fake equity on real homes belonging to real people who did not otherwise qualify, which is what let Genworth approve and the FHA insure loans that should never have closed.
Where the money actually went
Mackey’s false HUD-1 settlement statements concealed that existing mortgages were not being paid off as borrowers were told, while nearly $1 million moved into an account two of the loan officers controlled directly, spent, according to prosecutors, on personal expenses rather than anything connected to the borrowers’ stated purpose for the loan.
The caveat
All four defendants pleaded guilty, and the facts above describe a concluded set of federal convictions and sentences, not allegations. Sentences for the four defendants ranged from 24 to 70 months, reflecting the court’s assessment of each person’s role, with Gendason receiving the longest sentence as the scheme’s identified organizer.
Sources
- News and Press Releases: Florida Loan Officer Sentenced in Connection with $2.5 Million Reverse Mortgage Fraud and Loan Modification Scheme. US Attorney's Office, Southern District of Florida. Accessed 2026-10-01. Supports: Gendason's age and location, his role as scheme mastermind, the 70-month sentence, the more-than-$2-million restitution order, the five-year supervised release term, Judge Dimitrouleas's name, the scheme's May 2009 to November 2010 timeframe, the fraudulent appraisal mechanism, the personal spending of proceeds, and US Attorney Wifredo A. Ferrer's quote.
- Four Charged in $2.5 Million Reverse Mortgage Fraud Scheme. HousingWire. Accessed 2026-10-01. Supports: Gendason, Incandela and Echevarria's roles as loan officers at 1st Continental Mortgage, Mackey's role as a title agent at Real Estate One Land Services, the $2,572,813 in FHA-insured loans, the false HUD-1 settlement statements, the $998,086.33 diverted to a Gendason-Incandela account, and the July 6, 2011 unsealing of charges.
- Loan Officer Gets 41 Months, Must Pay $1.9 Million in Reverse Mortgage Scheme. HousingWire. Accessed 2026-10-01. Supports: John Incandela's 41-month sentence and $1.9 million restitution order, his August 2011 guilty plea, his December 20, 2011 sentencing date, and the 60-month and 24-month sentences for Kimberly Mackey and Marcos Echevarria.