Chris Gallo Pleads Guilty to Mortgage Fraud Conspiracy

Christopher Gallo, formerly recognized as one of the nation's leading mortgage loan officers, has entered a guilty plea to conspiracy to commit bank fraud. This development occurred in a federal court located in New Jersey, as indicated by court filings that HousingWire reviewed. Gallo formally withdrew his earlier plea of not guilty and submitted a guilty plea to count one of the indictment, which specifically charges conspiracy to commit bank fraud. The plea was entered on Wednesday in the U.S. District Court for the District of New Jersey. He is currently at liberty on bail and is slated for sentencing on December 3. His former assistant, Mehmet A. Elmas, has a plea hearing scheduled for August 20. The U.S. Department of Justice (DOJ) initially brought charges against both Gallo and Elmas in April 2024. The DOJ's allegations assert that between 2018 and late 2023, the pair engaged in the falsification of loan documents with the intent to deceive mortgage lenders. Their professional history includes an initial period at NJ Lenders Corp., followed by their transition to CrossCountry Mortgage in late 2023. Subsequently, a federal grand jury issued an indictment against them, comprising one count of conspiracy to commit bank fraud, eight counts of bank fraud, eight counts of making false statements to a financial institution, and one count of aggravated identity theft. Representatives for Gallo and the DOJ have not yet provided comments in response to inquiries from HousingWire. Prosecutors contend that Gallo and Elmas systematically provided misleading information to lenders regarding the intended use of properties by borrowers, a practice aimed at securing more favorable interest rates. According to statements from the DOJ, Gallo and Elmas frequently submitted loan applications that falsely declared borrowers would occupy the properties as their primary residences. In reality, these homes were intended for use as rental properties or as investment vehicles. Under the terms of a plea agreement negotiated with the U.S. Attorney’s Office for the District of New Jersey, the government has committed to refraining from pursuing additional criminal charges against Gallo. This agreement is contingent upon his full compliance with the plea agreement's stipulations, which cover the mortgage lender deception conspiracy that reportedly spanned from approximately 2022 through August 2023. Furthermore, prosecutors have agreed to recommend the dismissal of the remaining counts against Gallo at his sentencing hearing. The charge of conspiracy to commit bank fraud, count one, carries a statutory maximum penalty of 30 years imprisonment. The plea agreement signifies a critical juncture in the legal proceedings against Gallo, resolving a significant portion of the charges he faced.