Mortgage Scammer in Court
An article from the New York Times explains a court case between Long Island “swindler” Peter J. Dawson and 21 families he conned out of their money. According to the article Dawson pleaded guilty in December 2007 and is currently serving his sentence of 5-15 years in jail.
Dawson’s scam involved home loans. He convinced homeowners who had already paid off most of their mortgage to take out another home loan. In return he claimed to pay off the new loan with investment money, however, he really just took their money. Many of the people he swindled lost a large chunk of their savings and are now struggling financially.
The article explains that it is still unclear if banks will be held accountable for any injury to the homeowners involved in the scam. Justice Winslow, who ruled that the banks actions need to be reviewed claimed, “Significantly, the courts have held that banks do owe duties of care to their own customers. Moreover, there is a public interest in ensuring the alleged duties relied upon are ‘performed with reasonable care’- as evidenced by the recent flurry of consumer-oriented laws and amendments enacted in the wake of the ’subprime mortgage meltdown.’”
