David Saks: MORTGAGE SWINDLER GOES DOWN - EX BANK VP GUILTY OF FRAUD - $10M LOST

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MORTGAGE SWINDLER GOES DOWN - EX BANK VP GUILTY OF FRAUD - $10M LOST

Former Vice President of Pierce Commercial Bank Pleads Guilty to Fraud
Leader of Mortgage Fraud Scheme Faces 10 to 14 Years in Prison

U.S. Attorney’s Office September 18, 2012
  • Western District of Washington (206) 553-7970
 

TACOMA, WA—A former senior vice president and loan officer at Pierce Commercial Bank pleaded guilty late today to a mortgage fraud scheme that resulted in the collapse of the bank, announced U.S. Attorney Jenny A. Durkan.

Shawn L. Portmann, 40, pleaded guilty to conspiracy to make false statements in loan applications and to make false statements to the Department of Housing and Urban Development (HUD), and one count of making a false statement in loan applications.

“Community banks are a critical part of our financial system,” said U.S. Attorney Jenny A. Durkan. “Mr. Portmann lined his pockets with millions of dollars in commissions and bonuses at the expense of the families who now find themselves underwater on their mortgages. His fraudulent conduct led to the demise of Pierce Commercial Bank and significant losses for other financial institutions.”

Under the terms of the plea agreement, both Portmann’s attorney and prosecutors will recommend a sentence between 10 and 14 years in prison when sentenced by U.S. District Judge Benjamin H. Settle on January 28, 2013. Portmann was indicted in August 2011 for a mortgage fraud scheme that resulted in the collapse of Pierce Commercial Bank in November 2010.

According to records in the case, between 2004 and 2008, Portmann and the other defendants conspired to submit false documents within various loan documents and applications. They falsified information about the borrowers’ qualifications as well as their intention to reside in the homes being financed. Based on a review of a sample of loans, the co-conspirators caused more than 270 loans that contained false and fraudulent documents and information to be funded by Pierce Commercial Bank representing in excess of $45 million in loan proceeds. More than 100 of these loan files have defaulted, causing in excess of $10 million in loss to Pierce Commercial Bank, secondary investors and HUD. The indictment details multiple false statements included in loan documents regarding an applicant’s employment, income, and intention to reside in the property.

Pierce Commercial Bank received $6.8 million from Troubled Asset Relief Program (TARP) in January 2009. This money was never repaid.

The case is being investigated by the FBI, the HUD Office of Inspector General, Internal Revenue Service Office of Criminal Investigation, and the U.S. Postal Inspection Service. The case is being prosecuted by Assistant U.S. Attorneys Brian Werner and Arlen Storm.

Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.

source: FBI



David Saks



Time&Temp Memphis

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Comment balloon 6 commentsDavid Saks • September 18 2012 11:04PM

Comments

So sad to hear about yet another criminal who hurt people.

Posted by MichelleCherie Carr Crowe Just Call...408-252-8900, Family Helping Families Buy & Sell Homes 40+ Years (Get Results Team...Just Call (408) 252-8900! . DRE #00901962 . Licensed to Sell since 1985 . Altas Realty) over 7 years ago

Glad to know that slimeball's going to prison. He should spend the rest of his life there if federal sentencing guidelines weren't an issue.

FBI fraud team is rockn' ! ! !

Posted by David Saks ((retired)) over 7 years ago

Good morning David. Always good to see justice does prevail sometimes. Wonder if they ever took notice of the number of lives they negatively affected. Probably not but they will have plenty of reflection time now.

Posted by Randy Ostrander, Real Estate Broker, Serving Big Rapids and West Central MI (Lake and Lodge Realty LLC ) over 7 years ago

Justice is prevailing thanks to vigilant fraud reaction teams working around the clock to expose the thousands of swindlers working for brokerages as real estate pros who continue to victimize families that trust them. I hope he's sent to jail for a long, long, long time. And a long time isn't enough time for that criminal.

Posted by David Saks ((retired)) over 7 years ago

David -- part of the plea agreement was to pay restitution and give us wealth acquired through these egregious practices.

Posted by Steven Cook (No Longer Processing Mortgages.) over 7 years ago

The only thing they've paid was hell and the only thing they've given us is a headache, Steven.

It's extrememly difficult for me to accept the alarming truth that so many trusted officials are in prison because of real estate-related fraud, with the numbers growing every business day.

Posted by David Saks ((retired)) over 7 years ago

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