I was honestly just drafting a post about how I don't believe many of my suspects to be arch criminals individually (well, a few of them perhaps…) and that I'm going to start redacting names and addresses for the more straightforward cases. Then I get another bonkers one!!! I’m sort of proud of this one, so pour yourself a big cup and…Enjoy! (And if you enjoy, give it a share maybe!?).
While I believe there is probably some amount of collusion between some of my suspects and their realtors and mortgage brokers, and some of the suspects ARE realtors, mortgage brokers, and even attorneys, I have never come across what I believe to be a conspiracy to commit mortgage occupancy fraud just to put together a shitty little rental property investment! Until now!
I will be a little more careful today, because one of our suspects is an attorney and while I am VERY well versed and rodeo-tested in our laws regarding free speech, libel, and defamation, I am not an attorney! Everything, while very well supported by the receipts, is only alleged of course! While some of them may create feelings of strong nausea, I have zero malice towards any of my suspects and only wish to educate on the perils of mortgage fraud for our society at large. Plus…they are remarkably entertaining! ;)
Suspect: Justin Vincent Zotts (DOB May/1974)
Additional Co-Conspirator Suspects: Dawn Marie Maguire (DOB 8/1972) and Matthew Glen Maguire (DOB 2/16/1974)
A very brief review of Mr. Zotts’ social-media feeds and long string of financial problems paints a picture of a wheeler-dealer promoter, talent agent and aspiring podcaster* “brah” of some flavor who has been twice bankrupt in two different states, and currently appears to have over 6 figures in tax liens:
*Only click on this if you require a sleep aid! ;)
Chapter 7 Bankruptcy filed in Idaho March 24th, 2017 (about a $180K hole with $90K of unsecured debts…)
Chapter 7 Bankruptcy filed in Nevada October 14th, 2005 (about an $80K hole with $70K of unsecured debts…)
$45,625 Federal Tax lien filed March 15th, 2018.
$50,337 State Tax Lien filed October 31, 2017
With this amazing background of success and the help of an unsuspecting mortgage lender, it would appear that he decided to go into the Phoenix real-estate business with a more successful childhood friend from Staten Island, a Matt Maguire. Unclear who was the instigator, but I think I know which one is the promoter/scammer and which is taking on all of the risk!
btw, that must have been one hell of a house party in Staten Island if they are still talking about it 31 years later!!!???
Phoenix Income Property - On August 5th, 2022, Mr. Zotts acquired 3406 E Libby St. Phoenix, Arizona 85032 for $499,000, financed by a 30-year conventional loan from Prosperity in the amount of $474,050. Owner Occupancy is a covenant.
Libby Street Investments LLC - In case we required more clarity on whether Mr. Zotts was about to commit owner occupancy fraud, he helped us out by incorporating Libby Street Investments LLC in Arizona on August 26th, 2022. The other member who has an interest as a member in this LLC is MGM Real Estate Investments LLC.
MGM Real Estate Investments LLC - This company was formed in Arizona in September of 2020 by members Matthew Maguire and his wife Dawn Maguire. Mrs. Maguire is an attorney and Mr. Maguire is a sales executive in the software industry. They own a $1.5 Million home in Scottsdale and an $800K home in Flagstaff. Nothing wrong with any of that, just for some color! It is unknown whether this LLC has any other real-estate investments. I couldn't find any other than Libby Street.
Rental of Phoenix Income Property - The property was on the luxury short-term rental market just a few months later and was available for rental for all of January, February and March. This is not an Owner-Occupied home, even without all of the alleged shenanigans.
The ALLEGED Shenanigans - Somehow, despite all of Mr. Zotts’ problems, he was able to secure a 5% down Owner Occupancy mortgage on a $500,000 home. He most likely didn't have the $25,000 down payment, so he entered into a side-deal with the Maguires to provide him with all or a portion of that, making all kind of promises about the killing they would all make during the Superbowl and beyond in the feverish rental market (that didn't happen and isn't happening). Unfortunately for the Maguires (and Mr. Zotts), they decided they probably couldn't trust a verbal agreement with Mr. Zotts, and used a self-incriminating corporation (maybe name it something else next time? Arch criminals!!!???), and certainly a written agreement exists regarding how the proceeds of this income property are to be distributed amongst the investors in the future.
Mortgage Occupancy Fraud Conspiracy (and Almost Certain Disclosure Fraud)- Complicated? Yes! Slam Dunk? Yes! Arch Criminals? Well, I figured it out in about 10 minutes so…no???
Mortgage Lender Stupidity - Creditors and tax authorities have been losing on this guy at the rate of about $10-$15K per year since the early 2000’s. Are the brokers/lenders drunk???