Two indicted in alleged mortgage fraud scheme

A federal grand jury has charged two people in an alleged mortgage fraud scheme that federal prosecutors said involved stealing more than $2.5 million from lenders across the country.

Zack Zafer Dyab, 45, of Golden Valley, and Julia Alexander Rozhansky, 45, of Minnetonka, were charged with mortgage fraud, conspiracy to commit wire fraud and related counts in a federal indictment that was unsealed Wednesday.

According to the indictment, the pair obtained fraudulent loans to buy 35 homes in the Twin Cities between 2003 and 2006.

Dyab and Rozhansky allegedly recruited co-conspirators to act as straw buyers to buy the homes. The straw buyers sometimes purchased the properties at inflated prices Dyab or his mortgage broker company, where Rozhansky worked. Other times, the straw buyers bought homes at inflated prices from third-party sellers, the indictment said.

Through the alleged scheme, Dyab and Rozhansky ended up using substantial portions of the loan proceeds for themselves, causing more than $2.5 million in losses to the lenders, according to the indictment.

Also Wednesday, the U.S. Attorney's Office in Minnesota announced a guilty plea in a separate mortgage fraud scheme. Prosecutors said Jeffrey Michael Taylor, 35, of Blaine, pleaded guilty to conspiracy to commit wire fraud in defrauding CitiMortgage out of more than $588,000.