A California real estate developer was sentenced to six years in federal prison for his role in a massive fraud scheme that involved manipulating home prices in Arizona and defrauding banks out of millions. Prosecutors said Michael L. Mastro conspired with others to artificially inflate property values by using straw buyers, falsified documents, and fraudulent transactions, primarily geared toward high-end homes during the housing boom. Authorities uncovered hundreds of suspicious transactions that contributed to the 2008 housing crash in the region.
The case shed light on how widespread real estate fraud played a significant role in undermining the market’s stability during that time. Investigators revealed that Mastro and his co-conspirators raked in profits by flipping properties at inflated prices, often leaving banks and borrowers with massive losses once the housing bubble burst. Officials hope the sentencing sends a message that real estate fraud will be aggressively prosecuted.
Read more about Arizona home prices.