The mortgage fraud case involving Senator Adam Schiff is generally clear-cut and challenging to defend against, as stated by financial crime specialists, who caution that the senator may incur significant fines and penalties.
The California Democrat has been referred to the Justice Department for prosecution due to allegations that he falsely asserted “primary” residence status in two separate states to obtain financial advantages.
Schiff is alleged to have submitted forged bank and property documents, identifying a home he shares with his wife in Potomac, Maryland, as their primary residence—an act that reduced their mortgage payments from 2013 to 2019, according to the Washington Times.
However, as a U.S. Senator from California—and formerly a Representative for a district in California—his legal primary residence is required to be in that state.
Notwithstanding this, Schiff also claimed a property in Burbank, California, as his primary residence during the same timeframe, obtaining a tax exemption that saved him around $7,000.
Borrowers can achieve lower mortgage rates by designating a property as their primary residence instead of a secondary home or investment property, as lenders consider primary residences to be less risky, the Times clarified.
These allegations represent a significant shift in fortune for Schiff, a prominent critic of President Trump who spearheaded efforts for his prosecution over business fraud.
Last year, Schiff accused Republicans of forsaking their principles to support Trump, who was subsequently convicted on 34 counts of business fraud in New York on charges that several legal experts deemed unfounded and politically motivated by Democratic state Attorney General Letitia James.
“The party, once known for its moral majority, is now, I suppose, attempting to create some form of immoral majority to reinstate Donald Trump as president,” Schiff remarked at that time.
“He has accused me of treason, he has also accused me of leaking classified information, and he has accused me of fraud; it has essentially been a series of unfounded allegations — all baseless, all lacking merit,” Schiff remarked regarding the president last week, according to the Times. “This is not a new occurrence. However, his assaults on the rule of law are more perilous than ever.”
Mortgage fraud cases are frequently prosecuted by the Justice Department, yet they rarely proceed to trial, as reported by Keith Gross, a Florida defense attorney specializing in criminal law, according to the Times.
He pointed out that such cases are usually settled through plea agreements, as they often depend on straightforward financial documentation that leaves minimal room for contention.
Should charges be filed against Schiff, the case will likely focus on whether he personally signed the documents and whether he genuinely resided full-time in the Maryland residence.
“If the responses to those inquiries are undisputed, there is no basis for a trial,” Gross informed the outlet. “Typically, you will see some form of payment included as part of a plea agreement, which would likely involve a fine, restitution, and possibly other penalties.”
In a post on Truth Social this week, Trump labeled Schiff a “scam artist” and asserted that he secured a mortgage for a Maryland property in 2009 but only classified it as a second home in 2020 as part of a scheme to obtain more favorable rates and terms from the lender, which has been under federal conservatorship since the 2008 financial crisis.
The president claimed that Fannie Mae’s Financial Crimes Division had uncovered the alleged misconduct.
“I have always suspected that Shifty Adam Schiff was a scam artist. And now I discover that Fannie Mae’s Financial Crimes Division has determined that Adam Schiff has engaged in a continuous pattern of potential Mortgage Fraud,” Trump wrote in part.
“Mortgage Fraud is extremely serious, and CROOKED Adam Schiff (now a Senator) must be held accountable,” Trump concluded.
