Soho S&M Club's Dominatrixes Used in Mortgage Scam

Arena Studios

A former Suffolk County lawmaker and the owners of a Soho S&M club were among five people Suffolk County prosecutors accuse of running a $50 million mortgage scam. Suffolk DA Thomas Spota, after detailing how the group allegedly bought homes with fake buyers taking out huge mortgages (with forged documents), pocketed the money and then left the homes empty, said, "The damage these defendants single-handedly caused to the East End is simply appalling."

Apparently the group used had "straw buyers"—people who were paid to pose as buyers— to facilitate getting mortgages—and those people were recruited via S&M Club Arena Studios. Suffolk DA spokesman Robert Clifford explained, "Some of the straw buyers were patrons of the club and the dominatrixes approached them and asked if they wanted to make some easy money." The straw buyers were allegedly paid $10,000 by the group, who would use their info to get the loans. According to the Post, the prosecutors say the scam worked like this: "When a bank would sign off on the loans, the five defendants would just pocket the money, which went into accounts they controlled...After the bogus transactions were completed, the properties slipped into foreclosure."

Those charged are: former Suffolk County lawmaker George Guldi; Donald MacPherson, and his wife, Carrie Coakley, who own Arena (MacPherson also publishes The SoHo Journal); title company owner Ethan Ellner; and lawyer Dustin Dente. Guldi said the charges were "BS" while a lawyer for MacPherson and Coakley told Newsday, "Anybody involved in the purchases of these houses were legitimate people. Foreclosure doesn't mean a crime was committed."

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By Jen Chung in News on March 26, 2009 10:08 AM

Comments [rss]

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NannyState

This is a dark stain on the reputation of the BDSM world. There will be a panicked remorse emmanating from dungeons all over the Tri-State area.

Sinchy

how many of the toxic sub-prime mortgages wrapped up in all those CDS derivitives thingies that are at the base of this financial crisis are phony?

I'm sure there are homes with many phony mortgages on them use to prop up these financial instruments.

If some kinky sex freaks could do it, I sure the bankers would have thought of it first and figured out a way for the tax payers to take the fall and get away scott free.

hotstepper

50 lashes for each of them!

jibbly

No, silly, that's what they want.

50 soft, purring kittens snuggling around their face for each of them!

JH4285

Wouldn't that ruin the straw buyers' credit? $10K doesn't seem like much for wrecking your financial credibility.

butterbutter

I don't get it.

The property isn't really sold, since the seller didn't receive any actual money. So is it going into foreclosure on the sellers side?

The straw buyers credit would have to be destroyed it seems. If anything the straw buyer is breaking the law by knowingly giving his/her info for the purpose of fraud. Either way, seems the staw buyer is getting the bad end of the deal. They'll also prob face prison time.