TRENTON – A title company owner was sentenced to prison Friday for stealing a total of $5.3 million entrusted to him as a settlement agent to pay off multiple mortgage loans in connection with real estate closings he handled.
Louis Macaluso, 47, of Westfield, who formerly owned and operated Affinity Title Agency, Inc., was sentenced to 10 years in state prison by Superior Court Judge Edward A. Jerejian in Bergen County. He also was ordered to pay a $10,000 fine.
Macaluso pleaded guilty on Oct. 31 to an accusation charging him with theft and misconduct by a corporate official, both in the second degree. He was sentenced to 10 years on each of the charges, with the sentences to run concurrently. The Attorney General’s Office, acting on behalf of the New Jersey Department of Banking and Insurance, previously arranged for Macaluso to surrender his New Jersey insurance producer license.
In pleading guilty, Macaluso admitted that, between July 2010 and September 2012, he failed to use funds entrusted to him as a settlement agent to pay off 34 outstanding mortgage loans on properties in New Jersey, Pennsylvania, Maryland and Ohio. The unpaid balances totaled approximately $5.3 million. Macaluso diverted the funds for his own use or the use of Affinity. All of the homeowners involved had their mortgages paid off in full by the title companies that had insured the titles on the properties.
“Macaluso treated his license as a title insurer like it was a license to steal,” said Hoffman. “This lengthy prison sentence should deter other dishonest operators in the industry who might be tempted to steal the large sums entrusted to them as fiduciaries.”
“Individuals involved in home sales and the companies that finance and insure these transactions need to be able to trust that the licensed agents handling the transactions will act with honesty and integrity,” said Director Elie Honig of the Division of Criminal Justice. “When agents like Macaluso breach that trust and steal, we will prosecute them to the full extent of the law.”
The three companies that sustained losses – New Jersey Title Insurance Co., Commonwealth Land Title Insurance Co. and Title Resource Guaranty Co. – filed civil actions in federal court against Macaluso, who executed consent judgments to pay full restitution. He has made an initial payment of $700,000.
Deputy Attorney General Frank J. Brady Jr. prosecuted Macaluso and handled the sentencing for the Division of Criminal Justice Financial & Computer Crimes Bureau. Detective Kimberly Allen conducted the investigation for the Division of Criminal Justice. The investigation began with referrals from the New Jersey Department of Banking and Insurance and the Division of Law.
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