Federal charges broaden in real-estate fraud and money-laundering case

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A federal grand jury Tuesday handed up a superseding indictment accusing real-estate professionals of wire fraud, bank fraud and money laundering in a home sales.

The indictment appeared on the U.S. District Court docket today.

The indictment expands the charges against Dov Ratchkauskas, of Squirrel Hill, and his former partner George Kubini, of Verona, who were originally indicted in 2011.

Newly charged are real estate attorney Arthur Smith, of Point Breeze, whose office is Downtown, and property appraiser Sandra Svaranovic, of Bethel Park.

According to the indictment, from 2005 through 2008, Mr. Kubini and Mr. Ratchkauskas sold properties using "fraudulent means" and signed "fraudulent settlement statements."

The two also "falsely represented to the purchasers of the properties that they would make improvements to the properties," according to the indictment.

Mr. Kubini in 2007 and 2008 failed to report some of his income to the IRS, according to the indictment.

In conjunction with the property sales, Mr. Smith submitted statements to lenders that overstated the sales prices, falsely indicated that borrowers had made down payments and omitted payments made to borrowers or purchasers, according to the indictment. He is also accused of moving money out of an escrow account meant for property transactions "into his personal bank accounts for his personal benefit."

The indictment also said Mr. Smith failed to submit required forms to the IRS disclosing payments to Mr. Kubini and Mr. Ratchkauskas and didn't file federal tax returns for himself in 2007, 2008 and 2009.

Ms. Svaranovic "overstated the true values of the properties serving as collateral for the loans," according to the indictment.

Federal prosecutors want $1 million from Mr. Kubini and Mr.Ratchkauskas, money they claim represents the proceeds of the violations.

Attorneys for Mr. Ratchkauskas and Mr. Kubini could not immediately be reached. Mr. Smith and Ms. Svaronovic could not immediately be reached.

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Rich Lord: rlord@post-gazette.com, 412-263-1542 and on Twitter: @richelord.


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