That branch had been at the first location since 1993. The main branch made it through the year unscathed, as did all six branches of Abacus Federal Savings Bank - unless you count the fact that a dispute with the landlord over a rent increase at their Brooklyn branch forced them to relocate five blocks away during the pandemic. “I figured if something would happen we just saved the wood and all the materials just in case.” The DA’s office was assisted in its investigation by the Federal Housing Finance Agency and the Internal Revenue Service.“I couldn’t fathom it,” says Sung, who is not technically an employee of the bank herself but sits on its board of directors. And Fannie Mae made more than $100 million on these loans.’’ “We do not understand why our community bank - which is the only victim in this case - would be targeted for prosecution when many other banks that contributed to the national economic crisis remain untouched.”Ībacus spokesman James Haggerty told The Post, “The bank has among the lowest default rates in the country - less than 0.50 percent, compared to the national average of more than 5 percent. “The bank feels that a grave injustice has occurred and that the DA’s office is overreaching in trying to make a case against the bank,” Abacus officials added. “Neither Fannie Mae nor the borrowers were ever harmed. “There is no evidence that any senior executive at the bank engaged in illegal behavior,” the statement said. The DA touted the bust as the first time a bank has been indicted in a case brought by Manhattan prosecutors since then-DA Robert Morgenthau won a fraud and money-laundering indictment against BCCI in 1991.Ībacus officials released a statement saying they were “greatly disappointed” by the indictment given the bank’s role in uncovering and investigating at least some of the alleged misconduct. Officials with the DA’s Major Economic Crimes Bureau then began probing Abacus documents, uncovering fraud going back to May 2009, Kaufmann said. The alleged scheme began unraveling in December 2009, when a potential borrower walked into Chinatown’s Fifth Precinct station house to claim that Abacus had stolen her deposit of several thousand dollars, said Adam Kaufmann, chief of the DA’s investigation division. Of the 19 accused bankers, eight have pleaded guilty and the remaining 11 have been indicted by a grand jury, prosecutors said. The bank - which has branches in Chinatown, Flushing and Downtown Brooklyn - is in no danger of collapsing, prosecutors added. The vast majority of the borrowers are current on their payments, but the risk of future default is still high, officials said. The mortgages were granted on the basis of the bankers’ misrepresentations of the incomes and worth of the borrowers, who tended to work in cash-only businesses, Vance said.īased on these paperwork lies, a package of more than 4,000 shaky mortgages was then resold to the Federal National Mortgage Association, commonly known as “Fannie Mae” - the primary victim of the scam along with taxpayers themselves, should the borrowers default, Vance said. Those charged include the bank’s chief credit officer, Yiu Wah Wong, 61, of Flushing, Queens, the most senior loan-department manager. said at a press conference announcing the arrests of 19 former bank workers as part of a 184-count indictment. “If we’ve learned anything” from the 2008 mortgage collapse, “it’s that at some point, these schemes unravel and taxpayers are left holding the bag,” Manhattan District Attorney Cyrus Vance Jr. A small Chinatown-based bank that caters to poor immigrants has been busted in a massive mortgage-fraud scheme for allegedly securing hundreds of millions of dollars in loans for unqualified borrowers.Ībacus Federal Savings Bank raked in millions of dollars in fees while systemically falsifying thousands of loans that it knew were over-the-top risky, authorities said yesterday.
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