Mug Shot Monday — Philadelphia Loan Broker Gets 16 Years For Ripping off 2,000 Small Business
March 9, 2015
By Bob Coleman
Editor, Mug Shot Monday
After his partner got 18 years in jail in March, Matthew McManus is facing a similar fate with a 16 year sentence handed down last week.
The fraud wasn’t new. Just a simple loan fee paid in advance with the promise of a loan down the line.
I first reported this story last October, but since I am addressing the National Alliance of Commercial Loan Brokers tomorrow about loan broker fraud, thought this would be a good time to refresh every one’s memory.
“I used to think of myself as someone who could contribute good things in the world. Now I understand the pain I have caused the victims.” said Matthew.
“The environment is just ripe for this type of fraud,” Assistant U.S. Attorney David L. Axelrod said. “Banks have really limited the types of loans they’re making and increased their criteria for loans. It has made a lot of entrepreneurs and first-time businesses really desperate and willing to turn to less-than-reputable businesses.”
According to prosecutors, Remington’s scheme worked similarly for each victim who came to the business between 2005 and 2011.
Clients seeking funding found their way to McManus and Bogdanoff after a reference from a New York loan brokerage firm.
Remington agreed to help each of them land financing in exchange for up-front fees in excess of $10,000.
But the company never had any intention of helping. Once the money had been paid, its staff worked to find fault with the proposed projects so that Remington could later blame those problems for its inability to line up financing.
And while some of the company’s clients were left bankrupt or even homeless, McManus raked in millions, which he used to buy a private plane, a $130,000 Porsche, million-dollar homes in Glenside and Nantucket, Mass., and a Locust Street pied-à-terre for his wife.