PHOENIX — In April of 2023, Michelle Ugenti-Rita obtained a mortgage for $680,000 on a home worth $850,000. Mortgage records and a Deed of Trust filed that month show Ugenti-Rita was listed as the sole borrower and as “unmarried.”
But court records show Ugenti-Rita was still married at the time, although her husband filed for divorce four months later.
Those divorce proceedings are ongoing, and the couple remains married.
Now a political activist – noting that disclosure fraud amounts to a felony offense - wants law enforcement to investigate Ugenti-Rita. Her political opponent in the primary race, incumbent Thomas Galvin, says he believes the allegation reflects a history of scandal.
Citizen files complaint against Ugenti-Rita
Last week a 12News reporter spoke to Ugenti-Rita at the property listed on the mortgage. Ugenti-Rita went inside the home and did not answer questions.
It was citizen muckraker Bill Coffin who first published details of the alleged mortgage fraud on social media. Earlier this month Coffin sent letters to the Arizona Attorney General and to mortgage lender Rocket Mortgage, asking them to investigate Ugenti-Rita’s mortgage application. Rocket Mortgage confirmed they will investigate the complaint “internally.” The Attorney General’s Office told 12News they received Coffin’s complaint but they will not comment on the potential of an investigation.
“I would respectfully submit that she (Ugenti-Rita) has committed a willful and material felony mortgage fraud,” Coffin wrote.
Coffin unearths documents of alleged mortgage fraud and other claims of financial misdeeds of politicians.
“She (Ugenti-Rita) was a real estate agent for 15 years. She knew what she was doing,” Coffin said. “Disclosure fraud is serious. If the laws don’t apply to you, then yeah, I don’t believe you should be supervising the rest of us.”
Estranged husband also accused Ugent-Rita of fraud
Four months after Ugenti-Rita obtained the mortgage, her husband Brian Townsend filed for divorce. Townsend’s attorney wrote in the filing, "Marital residence... was acquired during the marriage solely in Wife's name and is fraudulently titled to her 'as a single person'."
Ugenti-Rita and Townsend remain married but court records state they are living separately and in the middle of back-and-forth negotiations involving the divorce.
Townsend was unavailable for comment.
Opponent alleges “long history of scandal”
Ugenti Rita, a former state lawmaker, is running for Supervisor in District 2 covering most of the East Valley. Her Republican primary opponent, incumbent Thomas Galvin, tells 12 News in writing: "My opponent has a long history of scandal and the investigation for mortgage fraud is just one more. I'm proud to be endorsed by every police association and believe the contrast for voters is clear."
In 2018 a former lobbyist at the state capitol claimed she was sexually harassed by Ugenti-Rita (then a state legislator) and Townsend. An independent investigation later laid blame on Townsend only. Ugenti-Rita and Townsend were dating at the time of the alleged harassment and they later married.
Why mortgage lenders take disclosure fraud seriously
“It’s all about risk and we have to know what the risk is in terms of income, credit, portfolios. All of that matters,” said Kelly Powers of the Arizona Mortgage Lenders Association, speaking about disclosure fraud.
Powers said although she is not familiar with this particular case, someone might falsely list their marriage status for various reasons.
“It matters with different loan types,” Kelly said. “Misconstruing your marital status could be a situation in which someone is in the process of getting a divorce and they don’t want their spouse to know what they are doing.”
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