Families Scammed By Convicted Mortgage Fraudsters Are Still Fighting For Their Homes

CHICAGO — Dee McConnell remembers her mother, Mae Ella Dunn, waking up at 5 a.m., taking the bus to her factory job and saving her wages to buy a house. In 1995, Dunn moved her family from the Cabrini-Green public housing development to their new home in the Austin neighborhood. 

But today, the home Dunn labored to buy no longer belongs to her children.

Before Dunn passed away about five years ago at the age of 89, she commissioned contractor Mark Diamond to repair her home. But Dunn suffered from dementia, and she didn’t realize Diamond had misled her into signing papers that added debt to her house through what’s called a reverse mortgage.

McConnell asked her mother why she didn’t have the agreement reviewed by someone else first, McConnell recounted. The two then had a tense conversation, but “she was so just enamored with Mark Diamond,” McConnell said. “He was the epitome of a con man, so it was hard to tell her anything at that point.”

The reverse mortgage led to thousands of dollars in additional debt. When Dunn died, she owed roughly $60,000 on the home. McConnell had to sell the property to pay off the debt. 

McConnell said she and her family lost more than a house.

“There’s no legacy passed down by my mom,” she said. 

Dunn’s family was one of more than 100 swindled by Diamond. In January 2025, after Diamond pleaded guilty to wire fraud, U.S. District Judge Franklin Valderrama sentenced him to more than 17 years in federal prison and ordered him to pay $2.7 million in restitution. Several of his accomplices were also sentenced to prison last year. 

But the saga is far from over. As the leaders of the scheme serve their time, some of their victims are still fighting to get control of their family properties. They often find it difficult or impossible. After battling the lenders used for the reverse mortgages, dozens of victims have already lost in court, stripping them of their properties for good. 

Attorneys Juliet Sorensen and J. Samuel Tenenbaum are representing 45 clients, arguing the reverse mortgages are fraudulent because homeowners were tricked into signing the paperwork. A reverse mortgage lets homeowners, typically aged 62 or older, borrow against the equity in their homes. The loan usually doesn’t have to be repaid until the owner sells the home, moves out or passes away — but interest on it keeps accruing.  

“They were defrauded into applying for that reverse mortgage, [so] you would think it would be a no-brainer that the mortgage would therefore be void,” said Sorensen, a clinical professor of law at Loyola University Chicago’s law school. “That has been challenging, more challenging than your common sense would tell you to expect in the courts.”

Families are forced to make difficult decisions. In some cases, like Dunn’s, the original victim has passed away, leaving their descendants to deal with the aftermath. In other cases, they’re fighting to stay in the home and pass it down to their children and grandchildren. 

“There are some folks who are heartsick, ready to move on and open to a settlement, whatever that might be,” Sorensen said. “There are other folks who want to litigate and fight against the judgment of foreclosure, and understandably so.”

Sorensen and Tenenbaum have secured wins for some of their clients. In one instance, the U.S. Department of Housing and Urban Development planned to sell the home of one of Diamond’s victims in a foreclosure sale. But after Sorensen and her team urged the agency to reconsider, the department said in December it would pause the sale while it determines the right course of action, she said. (HUD did not answer emailed questions from Block Club Chicago.)

“These cases are so complicated that it takes a village to undo the damage that this fraud has caused,” Sorensen wrote in a follow-up email. But, with the decision from HUD, that client and her family were “truly home for the holidays.”

Diamond began defrauding homeowners two decades ago. His focus became seniors who struggled to get financing to fix up their properties, primarily on the South and West sides. 

Homeownership rates among Black Americans have historically lagged behind other groups, Census data show. Block Club has previously reported on the obstacles older Black homeowners face when applying for home equity lines of credit and refinancing, as well as the limited home repair resources available through the Chicago Department of Housing. 

“In a way, Mark Diamond took advantage of the fact that disinvested neighborhoods have challenges around home repair,” said Ann Lui, a partner with the architecture practice Future Firm. “And many of the programs that used to support low-income people in getting those home repairs have kind of evaporated over time.”

In November 2003, a federal judge barred Diamond from closing loans. He then used an independent agent to close them for his company, according to his plea agreement.

Diamond instructed Cynthia Wallace, his employee, to approach seniors seeking home repair services — particularly Black homeowners on Chicago’s West Side, because they tended to be older and hadn’t refinanced. If they couldn’t pay for the repairs, Diamond told Wallace to suggest they apply for a reverse mortgage.

When they balked at signing a reverse mortgage, Diamond instructed Wallace to mislead the homeowners into believing they were part of a government program to repair their homes, according to the plea deal.

In 2010, the Illinois Department of Financial and Professional Regulation revoked the license of OSI Financial Services, which Diamond owned, and fined the company $10,000. The department also suspended Diamond’s mortgage loan originator license, but a Cook County judge reversed the decision, court records show. 

Diamond then enlisted Matthew Fefferman, owner of Harbor Financial, to offer loans and take applications to the homeowners. Forrest Fawcett, who owned Able Title Company, sent the homeowners’ reverse mortgage checks to Diamond, and Gary Thomas Bohn received a fee for each home appraisal from Diamond, per the plea agreement. All ended up being co-defendants in the case. 

In 2011, Diamond deceived Dunn into thinking that he would fix the roof of her home and make other repairs, according to McConnell and court records. He billed Dunn for less than $30,000 for the repairs, but the work he promised to complete would have been more expensive than that. 

According to Cook County property records, Dunn then obtained a home equity conversion mortgage, a kind of reverse mortgage. Diamond never finished the repairs on her home.

After Dunn’s passing, McConnell sold the home to repay the reverse mortgage. In the end, the home was in such disrepair that the family would have needed to spend more money to fix it up, she said. 

“I would have loved to have held on to that house, but it just wasn’t in the cards,” McConnell said.

Sorensen said lenders should acknowledge that reverse mortgages have become a vehicle for elder fraud. They should also ensure that borrowers understand the terms of the loans. She’s also fighting to get courts to recognize that many of Diamond’s victims weren’t empowered to know the risks of the contracts. 

“These people were duped into entering into reverse mortgages that they thought were all above board. And in many instances, it was years before the original homeowners or their family members discovered the fraud,” Sorensen said. 

But the law currently favors the mortgage companies, according to Sorensen and court records reviewed by Block Club.

Other families didn’t grasp the details and potential repercussions of the reverse mortgages. All those factors led to Kerwin Cockrell losing his family home. 

In 1968, after his parents “scraped and saved,” Cockrell’s family moved from Cabrini-Green to their home in Humboldt Park, he said. He has vivid memories of the home. 

“It was always something happening, barbecuing [or] something,” Kerwin recalled. “My mother cooked a big Thanksgiving dinner and Christmas dinner. And auntie [was] there Memorial Day. They would hook it up. We’d all get together, nothing but family.”

In 2013, Cockrell and his brother Bruce were living in the home together when Diamond contacted them about making repairs to it. Diamond said they would need to obtain a reverse mortgage to pay for the work, according to court records.

Diamond convinced Kerwin Cockrell to transfer the deed to Bruce, who was about old enough to qualify for a reverse mortgage. Next, in January 2014, Diamond instructed Bruce and his wife, Eloise, to take out a $262,500 reverse mortgage with American Advisors Group, court records show. 

The Cockrells never received the funds from the reverse mortgage, nor did Diamond do the repairs he promised, according to court records. 

After Bruce Cockrell passed away in 2016, American Advisors Group sent a “2nd notice” letter to Bruce and Eloise Cockrell on Feb. 1, 2017, asking them to confirm that they still lived in the home, a key condition of their reverse mortgage contract.

In court proceedings, Eloise acknowledged that she had received letters from the mortgage company, but she said she didn’t understand what would happen if she didn’t respond, records show.

When American Advisors Group didn’t receive confirmation, it filed to foreclose on the property in June 2017. 

In early 2018, American Advisors Group bought the Cockrell’s property through a foreclosure sale. The Cockrells were ordered to move. 

Tenenbaum, a clinical law professor at Northwestern University, fought the eviction all the way to the Illinois Appellate Court, arguing that the reverse mortgage was fraudulent. In the end, the court ruled in favor of American Advisors Group. 

“Although Eloise did not believe that the [American Advisory Group] documents pertained to her, she did understand that they referenced the mortgage, and she should have sought more information rather than ignore them,” the appellate ruling stated.

Tenenbaum and Sorensen filed a motion for leave to appeal to the Illinois Supreme Court, but the court declined to take the case.

In October, Diamond’s co-schemer Bohn was sentenced to 18 months in prison, and Fefferman, one of the other participants, was sentenced to 30 months. In November, Diamond’s accomplice Cynthia Wallace was sentenced to 42 months in prison, and Fawcett is expected to be sentenced in 2026, according to a spokesperson for the U.S. Attorney’s Office in Chicago and court records reviewed by Block Club.

In November 2024, Kerwin Cockrell moved in with his son in Roseland. Cockrell said one of his daughters takes care of him, adding, “I thank the Lord that he blessed me with good children.”

But in losing the house, Cockrell said, he’s lost a family legacy. He had hoped to put it in a trust so they could maintain it as a family home, he said. 

Cockrell said Diamond and his co-conspirators deserve the prison sentences they received. 

“No, he didn’t murder anybody, but I mean, he destroyed a whole lot of lives—him and the rest of them,” Kerwin said. “So I believe that they should get their just reward.”