News

July 3, 2009

Pair charged with embezzling $1M

W-B husband, wife face grand larceny, tax charges in connection with mortgage fraud scheme in New York.

By Sheena Delazio sdelazio@timesleader.com
Staff Writer
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WILKES-BARRE – Two city residents were arraigned Wednesday in Staten Island, N.Y., on charges they embezzled more than $1 million from their franchised mortgage company and homeowners seeking to clear titles.

Richmond County District Attorney Daniel Donovan, Jr., said Wednesday Joseph DeVito, 39, and his wife, Mary Ann Palladino-DeVito, 41, were charged with grand larceny and repeated failure to file personal income and earning taxes.

Donovan said the couple is also accused of failing to pay personal income tax to the State of New York from 2002 to 2004. The two can face up to 25 years in jail, he said.

When contacted Thursday to see if Palladino-DeVito was in her office, a department manager at Reliable Abstract, a real estate title company in Scranton, said that Palladino-DeVito no longer worked at the company.

The representative said she could not confirm or comment on Palladino-DeVito being employed there. She is listed as a closing associate for the company.

William J. Smith, a spokesman for Donovan’s office, said Thursday that the couple’s charges involve only one company and are concentrated in the New York metropolitan area.

Smith said any victims in the case were paid back their money from the parent company, Fidelity National Title, based in Jacksonville, Fla.

Smith said the district attorney is unsure why the duo came to Pennsylvania and is unaware if they had employment or any family while living in Wilkes-Barre.

Palladino-DeVito and DeVito are scheduled to appear at a status conference on July 22. They are currently being held in Staten Island on $150,000 bail each.

“As part of this mortgage fraud scheme, these defendants are alleged to have victimized new homeowners and their franchiser by accepting payment for mortgage fees, mortgage taxes, customer fees, real property filing fees and escrow account funds and then misappropriating the funds for their own purposes,” Donovan said in a press release.

Donovan added the couple is also alleged to have failed to file any tax returns in the state of New York while they operated their business at an office on South Avenue in Staten Island.

The two were arrested Tuesday in Pennsylvania, after an investigation conducted by the Richmond County District Attorney’s office.

Records show the couple moved to Monroe County in 2004.

A call to DeVito’s lawyer, Manuel Ortega, was not returned Thursday.

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