Legal Ethics

Former Legal Assistant to Attorney-Judge Gets Probation in Mortgage Fraud Scheme

Telling a federal judge she was truly sorry and would never make the same mistake again, a 36-year-old New Jersey legal assistant was sentenced to probation instead of prison for tax fraud yesterday because of her cooperation with authorities in an alleged $8 million mortgage-fraud scheme.

Among the alleged co-conspirators was Melanie Gebbia’s boss, Garfield municipal judge and private practitioner William Colacino. He was named, although never charged, in a 2008 indictment and died of natural causes later that year, reports the Record.

Closing documents showing fictitious down payments were prepared by Gebbia at Colacino’s direction, the newspaper reports, and she also helped distribute checks funneling fraudulently obtained mortgage money to those involved in the scheme, including the real estate agent who was at its center. (Michael Eliasof, 66, who also cooperated, recently was sentenced to three years by the same federal judge.)

In return, Colacino and Gebbia were paid kickbacks, and failing to report $50,000 in 2004 income on her tax return brought Gebbia to the attention of federal authorities.

Colacino was removed from the bench in late 2007 and retired a few months later in 2008, after serving for 33 years in Garfield as a municipal judge and assistant prosecutor, an earlier Record article reports.

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