It’s A Hard Knock Life For Mortgage Fraudsters

For my generation the term “Hard Knocks” cannot be mentioned without the memorable image and sound of Jay-Z’s “ghetto anthem” rendition of “It’s A Hard Knock Life” from the play Annie.

My personal favorite lyric and image from the infamous song being: “I’m from the school of the hard knocks, we must not let outsiders violate our blocks.” You see, when I was in school the boys would go around claiming they were from the school of “hard knocks”, reciting this rap song and claiming they’d learned so much from awful, painful, negative experiences (you know, like Jeff Lang stealing their lunch money or illegally purchased cigarettes) in their life rather than what they’d learned in school.

Now knowing this fun fact about my young adulthood I’d like for you to put yourself in my shoes when earlier this month I came across a press release published in my current home city and state of Raleigh, North Carolina.

You see, earlier this month David Joseph Pikul was sentenced to 14 months in prison followed by three years supervised release for mortgage fraud. Pikul also owes restitution in the amount of $182,702.73.

APPARENTLY Pikul operated a law practice in Fayetteville, North Carolina. Between 2002 and 2004, Eric Omar Jones, also from Fayetteville, operated a business called the (are you ready for it?) University of Hard Knocks Investments, Inc. (UHK).

I said the…

University of Hard Knocks Investments

::deep sigh::

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Jones purported to be experienced in the purchase, renovation, and resale of foreclosed real estate for profit. During this time, Pikul served as closing attorney for numerous real estate transactions in which Jones used his investors’ loan monies from Omni National Bank to purchase properties for himself and U.H.K. (UNIVERSITY OF HARD KNOCKS!)

Pikul then assisted Jones to “flip” these properties to the unwitting investors for a higher price, with Jones receiving the profit and the investors receiving all the credit risk.

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To facilitate the scheme, Pikul created and submitted false HUD-1 settlement statements to numerous banks selling foreclosed properties and to numerous banks financing the purchase of the foreclosed properties.

The false statements to selling banks generally reflected that UHK had a loan with Omni when it did not, or that UHK was bringing cash to closing, when in fact, Omni was financing the deals under the auspices of a loan to a third party borrower.

Simultaneously, Pikul sent false documents to Omni and other banks funding the transactions. These documents generally reflected that the buyers brought money to closing or made earnest money payments that they did not make. It is estimated that losses to the various banks exceeded $200,000 – Source.

So, REALLY, who would take the University of Hard Knocks Investment company seriously? Oh right, maybe these guys…

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Yep. That JUST happened.

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