This publishing is intended to present and then track formal legal complaints related to three cases of mortgage fraud. These cases also expose Lanham Act Violations related to unfair competition, Predatory Advertising, False Advertising, and they expose the tip of a Fake Review Network that is staggering in breadth. Nothing less than Racketeering charges should come for some involved.
Our global commercial system is in great turmoil due to a level of corporate, government, and banking corruption that is unlike anything seen in modern history. As a small business person, I can't do much about that, but I can try to protect myself and positively affect my own marketplace by taking steps to unmask and rectify malfeasance that I'm aware of that is negatively affecting me and those around me.
This publishing and these complaints are are my way of seeking balance and rectification in a commercial system I'm involved in that has slipped way out of balance with too many negative affects on me and those around me to be ignored any further.
My intention is to pursue these complaints until all legal options have been aggressively exhausted and/or satisfactory corrections have been achieved.
My property at 627 S. Paca St was one of the first three properties in the marketplace in Baltimore in 2005.
From 2005 to 2014, the market slowly grew and it grew in a generally healthy manner.
Competitors knew each other. While competing against each other, we also worked together to meet the needs of larger groups and share leads when appropriate.
In 2015 there was a slow increase in competitors using unfair competitive means to break into the marketplace. One individual used an owner occupied VA Loan to break in. He felt joining the marketplace was lucrative enough it was worth committing a felony. It's believed he and others were using fake reviews to gain ground on those of us who had been in business longer as well.
In late 2016 and early 2017 there was a flood of new properties put in service by three or four different investors and/or investor groups with a wide ranging array of unethical and illegal activities which totally disrupted all aspects of the marketplace.
In May 2017 I felt forced to sell 625 S. Paca St due to intense competitive forces that have now been shown to be fully nefarious in nature.
The map to the right shows my properties marked as 625 and 627 S. Paca St. I was forced to sell 625 due to vicious competition that has turned out to be deeply illegal, so 627 is the only remaining property I have in service at this time.
The three market participants who committed mortgage fraud to get into the market are Michael Larcher, Isaac Guerrero, and Benjamin Cohen.
These three individuals collectively committed just under $1 Million in mortgage fraud to get into the market.
These three individuals along with the help of Matt Durrette have diverted an estimated $450,000 in short term rental bookings from Honest Hosts in the Baltimore Marketplace. A review of Matt's operations outside of this reveals he's likely profiting on $600,000 per year in revenues in addition to this using a multitude of illegal means.
Dozens upon dozens of honest investors and AirBnB in-home hosts have been forced out of business due to the illegal commercial behavior of these individuals while hose with lower ethical and legal respect are continuing to prosper.
Every honest participant in the Baltimore marketplace has been decimated from one aspect of unfair competition or another and it's time to rectify the damages.
For a more detailed back story please see the Back Story link on the menu of this website.
From a macro-perspective, mortgage fraud threatens the sanctity and balance of lending markets. The laws against mortgage fraud were created to keep the banking in balance.
From a micro-perspective, the damage from mortgage fraud is often a little harder to sense. However, when viewed in the context of the short term rental marketplace, it is far easier to see how even a few cases of mortgage fraud can cause massive damage to a marketplace that is extremely sensitive to fraud.
Mortgage Fraud is a felony. All the quotes below are from Wikipedia ( https://en.wikipedia.org/wiki/Mortgage_fraud )
Isaac's home is generally comparable in size and shape to mine and those in my neighborhood who were competing in a fair manner.
Isaac's home is located approximately the same distance to the Convention Center and the stadiums as ours.
Isaac was located closer to the Harbor than we were.
Isaac's VA Loan Fraud enabled him to enter the market with better pricing and no money down.
It's believed Isaac may have been a straw buyer for another investment group and it's believed that Isaac and/or the property mangers running his property have benefited from fake reviews in year one, but this is unsubstantiated at this time.
This mortgage fraud enabled Isaac to suck approximately $250,000 in sales out of the marketplace from 2015 to present. That is a massive amount of money to siphon off of a small market, and it had direct, negative affects on all of us who were competing in a fair manner.
PURCHASE: On 3/5/2015 Isaac purchased 710 S. Hanover St. Baltimore MD 21230 for $343,000
FINANCING: Isaac obtained a VA Loan for the purchase. The contract price for the home was $343,000 and Isaac's Loan value was $350,350, meaning he got 102% financing on the home courtesy of the US Government.
OCCUPANCY: This loan required Isaac to occupy the home within 60 days of purchase and to occupy the home for at least one year. He did neither.
INITIAL GUEST REVIEWS: On 5/18/2015 Isaac got his first review on the home on VRBO for a stay that was completed on or before that date.
This is about 72 days after his purchase on 3/5/2017.
During the period between purchase and this first review, the home got a full makeover that was remarkably similar in style to Tristar's work on fully furnished rentals in Fells Point on 915 and 919 Eastern Avenue.
There is a chance Isaac was a straw buyer for this investment group or some other.
Isaac had a total of three guests during May 2015...
ONGOING GUEST REVIEWS: Within 18 months of being in business, Isaac garnered 66 reviews, which is more than those of us who had been in business for almost a decade.
The review count situation was a combination of an abnormal rate of reviews from Isaac's guests and a shift in platform policies which was constantly hiding our older reviews.
The rate of Isaac's reviews and the nature of the reviews in year one are very suspect. The review count was skyrocketing with odd and out place comments about his parking pass and an ease of parking.
Reviews are the life blood of a listing. Most folks shop by review count first and then review quality.
Fake reviews can be garnered by "renting out your home" for unoccupied nights at the last minute to friends (or yourself) at dramatically reduced prices . No stay transpires, but a review is written afterward as if a stay transpired.
Here is a text dump of the reviews from 2015 through 2018, the time this dump was captured. Read from bottom up for chronological order (the bottom of this file has extrenious info from the dump, the 5/2015 review starts on page
See reviews for yourself at:
ABOUT ISAAC: Seems he moved to Baltimore in 2013. In this profile he admits to buying the home in 2015. Only part he left out was the fact he used a 103% owner occupied VA Loan to go into business...
ESTIMATED REVENUES FROM THIS RENTAL: If in fact this home was booked at market rates for all his stays, it is estimated Isaac's home would have done $45,000 to $55,000 per year in revenues for 2015 and 2016 and about $45,000 in revenues for 2017-2019.
In total, it is estimated Isaac has grossed $235,000 in revenues from his VA Loan mortgage fraud which got him into business with no money down, courtesy of the US Government.
As a result of this fraud, $235,000 in revenues that should be in the pockets of honest competitors is NOT in the pockets of honest competitors.
Detailed Document of Facts -- This document contains the information provided above in a similar manner as well as links to full versions of the supporting documents.
gDrive Folder -- This is a direct link to a public Google Drive folder that contains the documents and information presented here.
Formal Complaint with the following on the CC list...
Benjamin's home is generally comparable in size and shape to mine and those in my neighborhood who were competing in a fair manner.
Benjamin's home is located approximately the same distance to the Inner Harbor as ours. It would have been less attractive for convention traveler's, but at the prices he was marketing it at, many may have forgone proximity for price savings.
The major damage to me directly from Benjamin's fraud is tied to his relationship with his Cohost, Matt Durrette. The metrics benefits for Matt as a host, and for everyone in Matt's cohosting network are grand.
PURCHASE: On 3/24/2017 Benjamin purchased 1723 Gough St, Baltimore MD 21231 for $260,000.
FINANCING: Benjamin obtained a VA Loan for $267,019 for the purchase. The contract price for the home was $260,000 with a $10,000 seller contribution. Thus, Benjamin got 103% financing on the home courtesy of the US Government.
OCCUPANCY: This loan required Benjamin to occupy the home within 60 days of purchase and to occupy the home for at least one year. He did neither.
INITIAL GUEST REVIEWS: In May 2017 Benjamin got four reviews on AirBnB.
The home had been fully furnished and painted between date of purchase and the first reviews (inaugural reviews).
The four reviews were provided by 1) Justin 2) Jenna 3) Jeremy and 4) Ida
Justin, Jenna and Jeremy are people very closely related to Benjamin's AirBnB Cohost, Matt Durrette.
These three reviews represent fake inaugural reviews, and the fourth from Ida (not shown) may or may not be fake.
COHOST MATT DURRETTE:
Matt and his wife Jenna started their AirBnB business in November 2016 with the purchase of a property in Federal Hill.
At that time they immediately started soliciting to be cohosts for other hosts too.
It appears they were working with Benjamin before his purchase or certainly immediately after his purchase to bring his home on the market.
We know that from the fake reviews but we also know that because Matt coordinated the photo shoot for the property.
Matt and Jenna may have been coaching or may have coaxed Benjamin into committing the mortgage fraud.
Matt's own property is located in Federal Hill in a similar location as Isaac's above.
Matt directly advertises for convention business, and the majority of the stable of those he Cohosts for were/are similarly situated. Matt got credit on his own account for every booking on Benjamin's home and those metrics positively affected the ad placement for everyone in his network.
The mortgage fraud and the conspiracy here between Benjamin and Matt was/is far more damaging than it may appear on the surface. It was incredibly destructive to those with competitive properties in Fells Point, but it was/is in fact extremely damaging to all of us on the West side of downtown too when Matt's stable is taken into account.
Matt currently has over 1300 reviews on his account and that dramatically affects a very limited property display system employed by AirBnB for showing properties to potential guests.
FAKE INAUGURAL REVIEWERS:
As indicated, Matt's network of friends and his own wife (or himself) provided the first three reviews for Benjamin.
The top image is from benjamin's review.
The bottom image is from a website posting of Matt's wedding party (Matt and Jenna were married in 3/2019).
"Justin" is Justin Mundie, a Groomsman in Matt's Wedding.
"Jeremy" is Jeremy Ely, Matt's Best Man in his wedding.
We believe "Jenna" is in fact Matt's wife and Cohosting business partner OR it is Matt himself.
The "Jenna" profile may or may not have been registered under her identity or another person by the name of Jenna, but we are confident Jennna (of Matt and Jenna) and/or Matt controlled the "Jenna" profile and provided this fake inaugural review along with a plethora of other fake inaugural reviews and fake reviews stemming from this profile
MATT'S LEVEL OF INVOLVEMENT IN PUTTING THE BENJAMIN'S HOME INTO SERVICE:
If there is such a thing as conspiracy to commit mortgage fraud, it certainly seems Matt and Jenna may qualify.
In addition to providing the fake reviews, we found evidence that Matt is the person who scheduled the home photos for Benjamin's home at 1723 Gough Street.
Hometrack is a locally owned Professional Photography Company that specializes in Real Estate Photo Shoots and we found this in a google search with Matt's name and the 1732 Gough St address combined.
We do NOT know when this photo shoot was scheduled, but we are assuming it was before the home went on the market (before 5/2017).
ONGOING GUEST REVIEWS: In his first 48 weeks in business (from 5/2017 through 3/27/2018), Benjamin got 74 reviews on AirBnB. Ask anyone in the AirBnB business and they will tell you that is an IMPOSSIBLE review count at 1.54 reviews per week. There would need to be 74 cleaning fees associated with this level of business and the maintenance on the home would have been hefty.
As shown above, three of the inaugural reviews are known to be fake.
It is believed that a significant percentage of the other reviews were fake as well.
There are some tell tale signs of fakery in a handful of them, but we were unable to identify any of the other reviewers. There are numerous benefits to faking reviews and stays both for Benjamin and for Matt's extended co-hosting network. There also may be other reasons to fake reviews related to money laundering and/or ponzi.
REFINANCE: On 9/29/2017, just 6 months after purchase and in the midst of a flurry of reviews coming 1.5 per week, Benjamin did a cash out refinance of the home with another VA Loan for $281,530.
This new loan had the same basic occupancy clause requiring occupancy within 60 days and occupancy for one year.
It also had an additional Refinance Affidavit in which Benjamin had to verify that the home was his primary residence.
The mortgage officer and lending company should likely be investigated for propriety. This is very aggressive lending.
PRICING ANOMOLY ACROSS ADVERTISING PLATFORMS: Benjamin, with Matt as his Co-host, had an extremely odd pricing strategy when comparing HIS pricing on VRBO vs AirBnB.
On VRBO this home was priced at $550 per night with a $499 damage deposit.
At the same time, his pricing on AirBnB started at $129/night with no upfront deposit.
At $129/night he was well below what he should have been advertising for a 3 bedroom home.
As you will see in the next case of mortgage fraud, this odd pricing strategy shows up there too.
AS OF JUNE 2019, MATT HAS TAKEN FULL CONTROL OF BENJAMIN'S PROPERTY AND BENJAMIN IS NOW A SILENT OWNER: As of 6/2019 Benjamin's property has been removed from his AirBnB account completely. 1723 Gough is now showing up under Matt's profile only, and Matt's profile has been re-branded as "Cozi". (Matt originally went to market under "Matt and Jenna", then they switched to "Baltimore AirBnB's" and now they are "Cozi".).
The image below and on the left was when the home was marketed under Benjamin's profile. The image below and on the right is the new profile under the management company name of "Cozi". They started the property over under a different profile ID, presumably to bury the review malfeasance. The fireplace, the picture over the fire place, and the dining room table tell you these are the same properties. All the photos are taken from slightly different angles. That implies even the photographer was encouraged to take these from different positions.
All the prior reviews are gone and anyone coming to this profile now would assume this home is new to the market place.
Here is a link to Benjamin's property now, which is fully controlled by Matt and Cozi. https://www.airbnb.com/rooms/34247184
Matt and Jenna are not outwardly promoting themselves as the owners of "Cozi" on the profile, but a glance at the reviews on the "Cozi" account all mention Matt and Jenna, so they've just re-branded an existing account.
This case involves two cases of VA Mortgage Fraud (purchase and refinance), blatantly fake inaugural reviews, and what appears to be a conspiracy to commit mortgage fraud and then to cover it up.
When put all together this looks like it has the makings of racketeering in some form or another. This property has likely brought in over $100,000 in sales since it went into service in May 2017 and the activities related to this rental may also include money laundering and/or ponzi, although that is unsubstantiated at this time.
Detailed Document of Facts ---- This document contains the information provided above as well as links to full versions of the supporting documents.
gDrive Folder -- This is a direct link to a public Google Drive folder that contains the documents and information presented here.
Formal Complaint with the following on the CC list...
Michael's Second Home Loan Fraud enabled him to enter the market with better pricing and less money down than any of us could get on a purchase or refinance situation without committing a felony.
Michael's home is slightly larger in size and shape to mine and those in my neighborhood who were competing in a fair manner.
Michael's home was located about a half mile further from most of the draws for Baltimore travelers, but his actual location didn't matter as much given he decided to market his home as if it was in our neighborhood too.
This mortgage fraud enabled Michael to suck approximately $100,000 in sales out of the marketplace from 2017 to present.
That is a massive amount of money to siphon off of a small market, and it had direct, negative affects on all of us who were competing in a fair manner.
PURCHASE: On 4/25/2017 Michael purchased 748 W. Hamburg St Baltimore MD 21230 for $389,000
FINANCING: Michael obtained a Mortgage with a Second Home Rider for $350,100. The contract price on the home was $389,000 with $0 seller contribution. Thus, Michael got into this home with 10% down as opposed to the more typical 20% down for an investment property. He also got a better interest rate due to the fraud.
OCCUPANCY: This loan required Michael to occupy the home within 60 days of purchase and to occupy the home for at least one year. He did neither.
OCCUPANCY, Part 2: This loan has a Second Home Rider on it that more clearly specifies the occupancy terms...
INITIAL GUEST REVIEWS:
The first review on AirBnB is from "Floyd" and it is dated April 2017. If this was a real review, it means Michael had a completed AirBnB visit within 5 days of purchase.
During these same five days the home was painted top to bottom and furnished as well. Given the timing and level of work done, it seems Michael may have had access to the home before he purchased it OR these initial reviews were faked or both.
ONGOING GUEST REVIEWS:
From 4/25/2017 through 3/27/2018 Michael got 49 reviews (in 48 weeks). That is a phenomenal number. I do not believe all of these were legitimate stays. I can not identify the fake guests by name.
A screen grab of the last page of reviews taken in June 2019 shows Michael has 16 pages of reviews on this property now. At 7 reviews per page that represents approximately 106 reviews in 26 months (since April 2017).
FALSE AND PREDATORY ADVERTISING :
PRICING ANOMOLY ACROSS ADVERTISING PLATFORMS: Michael had the same, odd pricing strategy when comparing his pricing on VRBO vs his pricing on AirBnB as did Benjamin Cohen.
On VRBO this home was priced at $499 per night with a $1000 damage deposit.
At the same time, his pricing on AirBnB started at $99/night, which was well below anything that should have generated enough business for profits on a new $400,000 investment property.
COMMERCIAL DUMPING SPIN OFF:
Commercial Dumping is a tactic in international trade in which products are sold at extremely low prices and in a way that endangers the financial viability of manufacturers or producers in the importing country.
This very predatory pricing strategy was identical to that of Benjamin Cohen, and it's as if someone was coaching them both on ways to quickly decimate the marketplace before folks realized what was going on.
Detailed Document of Facts -- This document contains the information provided above as well as links to full versions of the supporting documents.
gDrive Folder -- This is a direct link to a public Google Drive folder that contains the documents and information presented here.
Formal Complaint with the following on the CC list...