DA says NY Mortgage Fraud had Link to S&M Club


SOUTHAMPTON, NY—In Suffolk County on Wednesday, a woman said to be a dominatrix and a former county legislator were among five people facing charges because of their participation in a $50 million mortgage fraud scheme. The scheme, which is said to have ties to a sex fetish studio, involved several dozen properties in the Hamptons over the past seven years.

“Straw buyers,” who use their name and credit information to falsely obtain mortgages, were instrumental in the scheme. Authorities say that straw buyers for dozens of Long Island properties were paid for their involvement in this frauds. Similar scams have surfaced around the nation in recent years, but hardly in such a high profile location.

The Hamptons are popular as a lavish and expensive summer retreat for the rich and famous. Prosecutors reported that some of the mansions and other summer rentals rented to vacationers were fraudulently purchased through the mortgage fraud scheme.

“The damage these defendants single-handedly caused to our local economy is simply appalling,” Suffolk County District Attorney Thomas Spota said. “We found the defendants repeatedly ignored the obligation to pay off existing mortgages and instead funneled the money into their personal accounts to finance their businesses and lifestyles.”

Spota said that the straw buyers would either claim they were employed by corporations controlled by some of the schemers or would fill out false loan application claiming higher or nonexistent incomes. One of the straw buyers claimed an annual salary of nearly $450,000.

Two of the companies involved were named. One source of straw buyers was a company called Maximum Restraint films and the other was identified as Arena Studios, Inc., a Manhattan business that at one time provided dominatrix services. The dominatrix, who was named as Carrie Coakley, once appeared in a film called “Whipped.”

Prosecutors reported that Coakley and her husband, Donald MacPherson, were the proprietors of the Manhattan S&M studio that offered handcuffs, gags, and paddles as props.

Several of the clients for the studio were recruited to pose as the homebuyers who could afford Hamptons vacation homes.

The couples’ lawyers report they are innocent.

“Anybody involved in the purchases of these houses were legitimate people,” he said. “Foreclosure doesn’t mean a crime was committed.”

Spota said that a major participant in the scheme was Ethan Ellner, an attorney and operator of a title company that used forged documents, false employment and income information on applications, as well as straw buyers, among other schemes. Ellner pleaded not guilty and was released on $25,000 bail. Neither he nor his attorney commented after court.


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