All levels of government received grievances about the lawsuit's key figure, Robert Penn, according to the IndyStar.com news story about homes being sold at inflated prices, defrauding lenders out of tens of millions of dollars and leaving investors on the brink of financial ruin.
"Federal, state and local authorities received warnings, some dating back two years, about the Fishers man at the heart of a mortgage fraud lawsuit involving the foreclosure of scores of Indianapolis-area homes."
According to the full article (click here) - Suspicions that something was wrong were so widespread in the real estate community that two title companies sent out notices warning other title companies to be wary about any deals involving Fishers businessman Robert Penn.
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Watch thy neighbor: One of Penn's neighbors, Ed White, suspected Penn of mortgage fraud in his own subdivision, Whitter Cove. So, as a real estate agent, former mortgage broker and member of the Whitter Cove Homeowners Association, he said he did some digging and reported Penn to the FBI and Argent Mortgage back in 2004.
Sounding an alarm?: Warren Township Assessor William Birkle said he suspected widespread mortgage fraud on the Eastside more than a year ago. A fraud analyst at Wells Fargo bank alerted him that it had received and rejected mortgage applications that appeared fraudulent for properties in that area.
A needle in a haystack: Officials had another chance to spot trouble. Frederick Bauter, an appraiser accused in the Countrywide lawsuit of inflating appraisals on homes that Penn was buying, lost his license in September 2005 after a state agency found he overappraised a Sheridan home in 2001.
Where will it end?: The suit lists 112 properties, but on Thursday, Robin Pickett of Prudential Ron Matthews Realtors in Indianapolis put the number closer to 400. Some reports put the dollar value of the loans, many of which have defaulted or are in foreclosure, between $40 million and $80 million.