Fairlawn Man Charged in $20 Million Fraud Scheme

A 35-year-old Fairlawn man is facing charges that he provided false loan and tax documents in connection with a mortgage fraud scheme estimated at $20 million.

According to the Federal Bureau of investigation, Jason A. Herceg, 35, has been charged in federal court in Cleveland with two counts of conspiracy to commit bank fraud, making false statements to influence a bank to make a loan and one count of filing a false tax return.

The charges stem from allegations that Herceg and his business partner, Andrew Norman, of Akron (charged previously) were involved in inflating the value of property they then sold at a profit.

The men are accused of procuring “straw buyers” and submitting false loan documents to banks to purchase lots in Florida (which had already been inflated in value as part of a land flip) in a mortgage fraud scheme. According to investigators, numerous straw buyers essentially sold their good credit scores to Herceg and Norman. The men then used the information to buy property in Florida. The straw buyers were paid for their information, then promised a 50 percent fee when the land sold. Straw buyers were told that Herceg's company would pay any down payment or mortgage. The plan fell apart when the mortgages were not paid.

Authorities said the plan involved a third person, who is not charged, who was assisted by Herceg and Norman in recruiting the buyers. False documents using the straw buyers' information was submitted to banks, which inflated the value of the property and issued mortages based on false information. Robert Jason Workman, another Herceg business partner, was also charged previously with filing a false individual tax return and under reporting his income in his business partnership with Herceg and Norman. Workman awaits sentencing before U.S. District Court Judge John Adams in Akron.

The second conspiracy relates to the sale of property in Florida to two elderly individuals for $7 million. Before the property was sold to the individuals, Herceg and Norman allegedly purchased the land and inflated its value by $2.25 million through Herceg and Norman's company 104 investments. The individuals who purchased the land were not told of the last-minute flip. Herceg is accused of under reporting his income for tax purposes, as well as the inflated sale.

Eleven straw buyers have been charged so far and entered guilty pleas to one count of conspiracy to commit loan fraud and bank fraud, causing losses to financial institutions in Ohio and Florida of approximately $13 million.

An Internet profile lists Herceg a Stow High School and University of Akron graduate, employed at 104 Investments from January 2005 to February 2007.