Schaumburg Mortgage Brokers Steven and Michael Garcia Charged With Steering Appraisals Through a Front Company

Case from 2017–2023 (U.S. Attorney's Office release: Dec. 14, 2017; later developments are from court records and other sources cited below). Published on Scammers.com Oct. 16, 2026; case status is current as of that date.

Brothers Steven L. Garcia and Michael R. Garcia, who ran American Financial Mortgage Services Inc., a licensed mortgage brokerage in Schaumburg, were charged in December 2017 with one count each of mail fraud and wire fraud. Prosecutors alleged they secretly controlled a supposedly independent appraisal management company to influence property values and brokered fraudulent loans for deals between themselves and nominee buyers [1].

Outcome: Michael Garcia pleaded guilty to mail fraud and wire fraud under a plea agreement on Nov. 20, 2020, according to a 2023 Illinois Department of Financial and Professional Regulation order revoking his mortgage loan originator license [2]. The court docket shows the case was closed in March 2021 [3]. We did not find Michael Garcia's sentence or the outcome for Steven Garcia in public sources. Steven Garcia is presumed innocent unless and until proven guilty.

What prosecutors alleged

According to the criminal information, as summarized by prosecutors [1]:

1. A front appraisal firm: Federal Housing Administration rules bar mortgage brokers from managing or paying appraisers. The Garcias allegedly got around this by controlling Residential Appraisal Management Company Inc. (RAMCI) through a nominee.
2. Hand-picked appraisers: They allegedly used RAMCI to steer appraisals to chosen appraisers, including a relative, who would provide values high enough to support the proposed loans. Meanwhile, lenders were told RAMCI picked appraisers for experience and skill.
3. Flipping to nominees: The Garcias and their nominees allegedly bought and resold homes at inflated prices to unqualified nominee buyers, who then defaulted.
4. False loan files: They allegedly gave lenders false employment and income information for the nominees and supplied the nominees with the money for the purchases.
5. The money: The information said they fraudulently obtained about $1.9 million disbursed at closings, plus about $274,000 in commissions.

The people charged

Michael R. Garcia, of Streamwood (43 when charged)

• Information (December 2017): one count of mail fraud and one count of wire fraud [1].
• Plea (Nov. 20, 2020): guilty to mail fraud and wire fraud, case No. 17 CR 798-2, according to the IDFPR [2].
• License: The IDFPR revoked his mortgage loan originator license in 2023 (No. 2023-MLO-03) [2].
• Sentence: not found.

Steven L. Garcia, of Schaumburg (45 when charged)

• Information (December 2017): one count of mail fraud and one count of wire fraud [1]. An information is an accusation, not proof of guilt.
• Status: no later outcome found in public sources as of Oct. 16, 2026. He is presumed innocent unless and until proven guilty.

Both cases were before U.S. District Judge Elaine E. Bucklo [3]. The investigation was conducted by HUD's Office of Inspector General and FBI Chicago [1].

Red flags for homebuyers

• Someone offers to "help" with your income or job details on a loan application.
• A seller or broker provides your down payment in exchange for putting the loan in your name.
• The same small group shows up on every side of the deal: broker, seller, appraiser and "investor."
• An appraisal that lands exactly on the contract price of a home that recently sold for much less.

What to do if you're targeted

1. Never sign a loan application with false information or agree to be a nominee or straw buyer. You can be held liable for the loan.
2. Check a property's sale history with the county recorder before buying.
3. Report suspected mortgage fraud to the HUD Office of Inspector General hotline or the FBI at tips.fbi.gov.

Case status (as of Oct. 16, 2026)

Defendant	Court	Status as of Oct. 16, 2026	Source
Michael R. Garcia, Streamwood	N.D. Ill. (Judge Bucklo)	Charged December 2017; pleaded guilty Nov. 20, 2020, to mail fraud and wire fraud; sentence not found; mortgage license revoked 2023	[1], [2]
Steven L. Garcia, Schaumburg	N.D. Ill. (Judge Bucklo)	Charged December 2017; no later outcome found in public sources as of Oct. 16, 2026	[1], [3]

Sources

1. U.S. Attorney's Office, Northern District of Illinois, "U.S. Attorney's Office Charges Suburban Mortgage Brokers with Fraud for Allegedly Controlling Property Appraisals in Scheme to Defraud Lenders," Dec. 14, 2017. https://www.justice.gov/usao-ndil/pr/us-attorney-s-office-charges-suburban-mortgage-brokers-fraud-allegedly-controlling
2. Illinois Department of Financial and Professional Regulation, Division of Banking, In the Matter of Michael R. Garcia, No. 2023-MLO-03, Order Revoking Mortgage Loan Originator License. https://idfpr.illinois.gov/content/dam/soi/en/web/idfpr/banks/resfin/discipline/lo2023/2023-MLO-03.pdf
3. CourtListener, docket for United States v. Garcia et al., No. 1:17-cr-00798 (N.D. Ill.). https://www.courtlistener.com/docket/6895122/united-states-v-garcia/

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