nothin Slum-Photo Doctor Makes A Call | New Haven Independent

Slum-Photo Doctor Makes A Call

Doctored photo of 221 Starr St. kitchen.

At a New Haven McDonald’s, Kenneth Perkins picked up his phone. He took an order: Doctor some more photographs, this time to spruce up a rundown Starr Street home with a fake freezer and stove — in order to advance an alleged scheme to rip off lenders.

An alleged schemer secretly recorded those words. Then a jury heard those words as the recording was played in court Monday on the fourth day of a mortgage fraud trial in Hartford U.S. District Court.

Perkins, a 28-year-old Groton man, spent his third day Monday testifying as the government’s star witness in the case. After conspiring in the scheme, Perkins agreed to wear a wire and help the FBI catch 14 people who allegedly cheated private lenders and the U.S. government out of millions of dollars and left a trail of blight across New Haven and other towns.

Melissa Bailey Photo

Gallagher.

Real estate appraiser Thomas Gallagher (pictured), who’s also a West Haven police commissioner, is among six defendants standing trial before Chief Judge Alvin W. Thompson. Others include a New Haven rabbi and a former New Haven state legislator, are among six defendants standing trial together before Chief Judge Alvin W. Thompson.

Or at least Gallagher was one of the defendants on trial. After Tuesday’s dramatic recordings, he ended up changing his plea in the case — to guilty.

It’s very simple,” Gallagher allegedly told Perkins in the recording aired in court. He then asked Perkins, the go-to photo doctor, to help him draft a fake appraisal for a house at 221 Starr St. in a section of New Haven’s Newhallville neighborhood struggling with blight and abandoned homes.

Thomas MacMillan Photo

221 Starr St.

Instead of leading to another mortgage ripoff, that conversation ended up in the hands of the federal government as Monday’s first court exhibit.

Gallagher’s was the first voice played before jurors in court Monday as prosecutor Eric Glover walked Perkins through a series of conversations caught on tape. Perkins has painted Gallagher as the most important” member of the scheme besides its alleged mastermind, Syed Babar, who has already pleaded guilty. Gallagher allegedly served as Babar’s go-to appraiser for the operation, earning $5,000 to $10,000 per deal.

The scheme allegedly involved having people pretend to buy houses and fix them up in order to obtain mortgages, then split the proceeds and stiff the lenders while leaving the houses to rot.

Melissa Bailey File Photo

Perkins is escorted into court last week by a federal agent.

Perkins (at left in photo) said he was at a McDonald’s restaurant, not far from the Starr Street house, when he talked to Gallagher on the phone. The call took place at 11:14 a.m. on Feb. 2, 2010, three weeks after Perkins first started cooperating with the feds.

In the conversation, Gallagher thanks Perkins for sending him a doctored picture of Gallagher and his girlfriend. The photo was originally taken in front of a hotel parking lot; Gallagher asked Perkins to change the setting to a beach. Perkins, who admitted in court to forging documents and altering photos for members of the scheme, obliged.

We love your picture,” Gallagher tells him in the recording.

The point of the call wasn’t to say thank you — it was to talk about 221 Starr St.

Make Sure It’s The Same Brand”

The house (pictured at the top of this story) was owned by New Haven landlord Marshall Asmar, who bought it out of foreclosure for $20,000 in June 2009.

The deal, which ended up falling through, was going to be the next in a series in which Babar’s crew would falsely inflate the cost of homes, take out government-backed mortgages with trumped-up loan applications, buy the homes for their actual prices, pocket the difference, and let the homes fall into foreclosure.

In a recorded conversation played in court last week, mastermind Babar shared a plan to make thousands of dollars off the sale of the house, then ditch it and pocket the profit.

The Starr Street home was going to sell” to a straw buyer for $125,000, Babar said on the tape. Babar planned to give Asmar $70,000 and divvy up the rest among his crew.

Babar planned to pay Gallagher $8,000 for a trumped-up appraisal, instead of his usual $375 appraisal fee, based on a premise that the place has been rehabbed.

The building was nowhere near rehabbed, Gallagher admitted to Perkins on the tape.

They repainted it, basically,” Gallagher says.

The prospective lender smelled something fishy with the transaction, Perkins tells Gallagher.

I think what happens is they’re just suspicious that he claims to put into that house,” Gallagher says on the tape.

He directed Perkins to get the keys from Asmar, take some interior photos, and send them to him for a new appraisal.

In court Monday, Perkins said he went to Starr Street after speaking with Gallagher. The deal was supposed to go through at the end of 2009. But the lender had noticed an error in the application — a social security number on a pay stub didn’t match, Perkins said. Perkins said he had forged those documents.

Perkins took photos of 221 Starr St. that day. Before sitting down at his computer, he allegedly got instructions from the top boss on how to doctor them.

If you put something in,” Babar tells him, make sure it’s the same brand.”

That directive came in another recorded conversation played in court. In it, Babar tells Perkins that the brand of the appliances he adds into the photos needs to match the brand on the invoice for a construction company that pretended to rehab the home.

Do your best,” Babar tells Perkins. On the tapes, the two speak with the familiarity of old friends. Babar calls Perkins KC.” Perkins calls Babar buddy,” and bro.”

Bro” Babar calls KC again on Feb. 2, 2010 to check up on his progress. The fake appraisal needs to be done by Valentine’s Day, he says.

If you could get that done that would be awesome.”

Look Real Enough?

Perkins, now cooperating with the feds, set right to work fixing up the rooms.

I used [Adobe] Photoshop,” he testified Monday.

Perkins, who studied computers in college, said he took the dimensions of the existing fridge, then put in a new one, skewed to match the size of the old fridge. To make it look real, he added a shadow cast by a nearby table. In the same way, he outfitted the kitchen with a stove and microwave, and a double-sink.

He sent the photo of the kitchen, as well as three others of the bathroom and a basement washer and dryer, to Babar, who passed them along to Gallagher, according to copies of emails presented in court.

In turn, Gallagher replied with an appraisal using the photo of the newly spiffy kitchen.

Perkins appeared dismayed to learn that Gallagher decided not to use the photo of the washer and dryer in the basement, nor a doctored photo of the shower.

They don’t look real enough?” Perkins asks Babar in another recorded talk. Babar told Perkins that Gallagher decided that those didn’t fit.” He told him to reduce the price of the sale accordingly to reflect that there was no washer and dryer.

The point was moot, it turns out.

The deal on Starr Street never went through, Perkins testified in court.

You Guys Don’t Learn”

Perkins broke that news to another alleged partner in the deal, former New Haven state Rep. Morris Olmer, in a meeting in Olmer’s office on Feb. 9, 2010.

Melissa Bailey Photo

Olmer (pictured) was going to handle the real estate transaction, and would be paid for the deal as well, according to the plan Babar was caught on tape describing in January.

The conversation begins at 12:05 p.m., when Perkins walks into Olmer’s office on Whalley Avenue. Perkins wore a wire to the meeting.

In a static-filled recording, Perkins breaks the bad news to Olmer about the deal.

What happened? I don’t understand,” Olmer says.

The lender checked with a bank about a fake invoice and found out that the payment had never been made, Perkins later explained in court. The statements didn’t match up,” he said.

Olmer, who’s now 82, scolds his younger colleagues, who are in their 20s.

Not a smart thing to do,” Olmer warns. Not at all.”

You guys don’t learn,” Olmer chides. You gotta understand, they’re checking everything now. … It’s not a good situation… We don’t need them investigating you. … That’s what’s gonna happen very quickly.”

Not that I’m a moralist and you know that,” Olmer continues. But it’s not the same as it was two years ago.”

Two years prior, Olmer had his license suspended in 2007 due to charges of mortgage fraud, Perkins noted. He permanently resigned from the bar in 2008. Because Olmer could no longer practice law, he used a colleague’s license to complete the deals, Perkins testified.

The two continue to discuss another potential deal. This sends Olmer into an apparent tizzy over the behavior of Marshall Asmar, a New Haven landlord and one of six defendants now being tried in the scheme.

In the recorded talk, Olmer refers to the mastermind, Babar, by his nickname Ali.”

Your friend Ali, and my friend Ali, he’s making deals with Marshall,” Olmer says. The problem is, according to Olmer: Marshall wants to make a lot of money, but he doesn’t want anyone else to make money.

Ali can only take so much of this prick,” Olmer concludes on the tape.

Hearing those words in court Monday, Marshall grinned and turned to his lawyer.

He didn’t grin when Olmer continued to disparage him on the tape.

Getting back to Marshall, Marshall’s a prick. He doesn’t want anyone to make any money,” Olmer says. What Marshall does is he fixes the property up just enough so the appraiser can see everything, then he takes everything out” — including the boilers and the electrical wiring — so he can use [that equipment] for the next rental.”

At the end of the conversation, Perkins asks Olmer if his colleague, James Aiken, can do loans” on future deals.

Nah,” replies Olmer. He tells Perkins to get back to him.

I may have someone who can.”

Perkins walked through all this testimony without cross-examination by the six teams of defense lawyers. They are set to begin attempting to tear away at his credibility when court resumes Tuesday morning.


Previous coverage of this case:

What Happened At Goodfellas Didn’t Stay At Goodfellas
Fraud Trial Opens With Oz-Like Yarn
Partying” MySpacer Lined Up Scam Homebuyers
Straw Buyer” Pleads Guilty
Neighbors, Taxpayers Left With The Tab
FBI Arrests Police Commissioner, Slumlord, Rabbi
One Last Gambit Falls Short
Was He In Custody”?
Is Slum Landlord Helping The FBI?
Feds Snag Poverty Landlord

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