May 24, 2018 07:02 AM
Todd Morgan will be arraigned in federal court in Buffalo, Thursday, while Kevin Morgan will be arraigned next week.
They're both charged with cooking the books and in some cases, going to extreme measures to say how much money certain properties were bringing in, in order to secure loans they otherwise wouldn't have qualified for.
Kevin and Todd Morgan are the vice president and project manager at Morgan Communities.
Federal prosecutors say with the help of these two mortgage brokers, Frank Giacobbe and Patrick Ogiony, they were able to lie to banks to secure $175 million in funding for a half-dozen developments in New York and in Pennsylvania.
"They would do things...making vacant units look as though they were occupied by doing things like placing mats and shoes outside of the apartment, turning on radios...turning on televisions in the apartment to make it appear as though they were actually occupied," U.S Attorney James Kennedy Jr. said.
The FBI has been investigating for years but it was just last week that they raided Morgan Communities in Pittsford.
Bob Morgan, the president of Morgan Communities and the uncle and father to the Morgans, has not been charged but the investigation is still on-going.
Jennifer Lewke: "Robert Morgan hasn't been charged in this indictment but do you believe he knew what was happening in his company?"
U.S. Attorney James Kennedy Jr.: "I can't answer that question."
Bob Morgan is Rochester's biggest developer. He is part of the Parcel 5 development plans and he is currently putting up the apartments near Dinosaur BBQ, and is behind Tower 280 at Midtown Plaza, just to name a few.
The city of Rochester and Monroe County do a lot of business with Morgan.
Lewke: "Morgan Communities has developed dozens of projects in the Rochester area, some of which are still coming. What would be your advice to people who are in the middle of a deal with Morgan Communities?"
Kennedy: "My advice to them would be to do their due diligence."
In a statement this afternoon, Bob Morgan told News10NBC that Kevin and Todd have been suspended without pay. They continue to state that "Morgan Communities continues to cooperate with a federal investigation related to federally backed loans placed to several developers through a specific mortgage broker. We have been and continue to be current on all loan obligations."
Updated: May 24, 2018 07:02 AM
Created: May 23, 2018 06:14 PM
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