BOSTON — A Connecticut real estate agent was sentenced in Boston federal court on Monday for participating in a multi-year scheme to defraud his clients, according to a release from U.S. Attorney Joshua Levy of the District of Massachusetts.
Prosecutors say Sheldon Haag, 34, of Glastonbury, Conn., engaged in fraudulent short sales of government and bank-owned properties to straw buyers acting at his discretion. Haag pleaded guilty to one count of conspiracy to commit wire fraud in June 2023.
On Monday, Haag was sentenced to one year and one day imprisonment followed by two years of supervised release. Haag must also forfeit $277,331 and pay restitution in an amount that has not yet been determined.
According to prosecutors, Haag and James Macchio, a fellow real estate agent, used straw buyers to obtain properties owned by the clients of a brokerage where they worked, which included banks, federal agencies, bankruptcy trustees and other mortgage holders. The scheme included a shell company set up by a co-conspirator made to look like a construction company.
Prosecutors say Haag and his co-conspirators hid their involvement as the de facto buyers of short sale properties from their clients and the property owners. They used their inside knowledge as the owner’s broker to decrease sale prices to maximize gain from later “flipping” the properties.
While executing the “flipping scheme,” Haag and his co-conspirators reportedly further defrauded clients by submitting fake renovation bids from contractors to their own clients, including from the made-up construction company that they controlled through a co-conspirator.
After clients accepted a fraudulent bid, prosecutors say Haag and his co-conspirators would hire different contractors at much lower prices and keep the difference between the fraudulent bid and the actual cost of the property repairs.
Macchio pleaded guilty in May and will be sentenced on Nov. 19.
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Dalton Zbierski is a digital content producer and writer at FOX61 News. He can be reached at dzbierski@FOX61.com.
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