Weston Man Sentenced to 33 Months in Jail

A 47-year-old was sentenced to 33 months in jail, followed by three years of supervised release, for his role in two mortgage fraud conspiracies, U.S. Attorney David Fein announced yesterday.

According to court documents, Genaro Hathaway, an attorney, "conspired with his husband, Steven Kottage, to commit wire fraud by making materially false statements to H&R Block Home Mortgage, Inc., including a false loan application, W-2, employment verification, and pay stub in connection with a mortgage on a home on Fire Island, New York," a press release from the attorney's office says. "In addition, Hathaway and Kottage conspired to commit bank fraud by submitting a materially false loan application to Washington Mutual to refinance a condominium in Hillsboro Beach, Fla. A co-defendant, Mary Ellen Durso, served as the straw owner for the condo in order to obtain the fraudulent loan proceeds for the benefit of Hathaway and Kottage. Through both schemes, Hathaway and Kottage defrauded Wells Fargo and Freddie Mac of more than $600,000."

He was sentenced to 41 months in prison. Hathaway pleaded guilty a week ater.

According to the press release, Hathaway and Kottage fraudulently appropriated nearly $750,000 while Hathaway was serving as the clients' closing attorney for real estate transactions. The investigation of this matter revealed that Hathaway and Kottage fraudulently appropriated nearly $750,000 in Hathaway’s clients’ funds while Hathaway was serving as the clients’ closing attorney for real estate transactions. When confronted by those clients, Hathaway and Kottage devised the mortgage fraud schemes to repay the stolen money, the release says.

"On Dec. 14, 2010, Durso pleaded guilty to one count of conspiracy and five counts of filing false tax returns," the release says. "On March 9, 2011, she was sentenced to three years of probation, the first six months of which she must serve in home confinement."

According to the release, this case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation. 

To report financial fraud crimes, and to learn more about the President’s Financial Fraud Enforcement Task Force, please visit www.stopfraud.gov.