A Connecticut real estate agent has been sentenced to a term in federal prison for orchestrating a fraudulent short sale scheme that targeted his clients, including banks and government agencies. James Macchio, 46, of Glastonbury, Conn., was handed a sentence of 42 months by U.S. District Court Judge Leo T. Sorokin, according to an announcement from the U.S. Attorney's Office. In addition to prison time, Macchio has been ordered to forfeit $621,579 and to pay at least $2,567,154 in restitution. This comes after his May 2024 guilty plea to one count of conspiracy to commit wire fraud.
Macchio, along with Sheldon Haag, another real estate agent, exploited a network of straw buyers to manipulate short sales and flip properties for a profit. Notably, a shell company set up as a purported construction firm by a co-conspirator played a role in these transactions. Utilizing their inside knowledge as real estate brokers, they schemed to defraud their own clients by depressurizing sale prices and maximizing their gain from flipping these properties.
The deceptive activities did not stop at misleading sales. Macchio and his accomplices submitted bogus renovation bids to their clients, pocketing the difference after hiring different contractors at a fraction of the cost. This bait-and-switch tactic bilked clients under the guise of legitimate business dealings. Additionally, during the COVID-19 pandemic, they garnered pandemic relief loans from the Small Business Administration, funneling these funds to support their fraudulent real estate ventures.
Sheldon Haag admitted his role in this expansive fraud and was previously sentenced in October 2024 to one year and one day in prison, which will be followed by supervised release. The multi-agency investigation that led to these convictions was announced by United States Attorney Joshua S. Levy with support from various government entities, including the Federal Bureau of Investigation, Internal Revenue Service, and Department of Veterans Affairs. Assistant U.S. Attorney Kriss Basil spearheaded the prosecution of this elaborate scheme.
