David Saks: Federal Jury Convicts Real Estate Broker on Wire Fraud Charges

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Federal Jury Convicts Real Estate Broker on Wire Fraud Charges

Federal Jury Convicts Albuquerque Real Estate Broker on Wire Fraud Charges

U.S. Attorney’s Office March 28, 2013
  • District of New Mexico (505) 346-7274
 

ALBUQUERQUE—Late yesterday afternoon, a federal jury returned a guilty verdict against Keith Michael Courtney, 31, of Albuquerque, New Mexico, on wire fraud charges after a three-day trial, announced U.S. Attorney Kenneth J. Gonzales and Special Agent in Charge Carol K.O. Lee of the Albuquerque Division of the FBI.

Courtney and co-defendant John Johns, 40, also of Albuquerque, were indicted in November 2011 on wire fraud charges. The three-count indictment alleged that between November 2006 and September 2007, Courtney and Johns schemed to defraud mortgage lenders by using straw buyers to apply for residential mortgage loans. At the time of the offenses charged, Courtney was part owner of Black Diamond Construction Company (BDCC), Veritas Mortgage Company, and Polaris Realty, all of which maintained offices in Albuquerque. Johns was a loan officer with Veritas Mortgage Company.

In February 2012, Johns entered a guilty plea to the indictment. During his plea hearing, Johns admitted his role in the unlawful scheme alleged in the indictment which resulted in three wire transfers of funds in the aggregate amount of $1,601,775.84 by mortgage lenders based on false and fraudulent representations made in connection with the sale of two residences built by Courtney’s business, BDCC.

Courtney proceeded to trial which began on March 25, 2013. The evidence at trial showed that Courtney’s company, BDCC, built two houses, one in Albuquerque and the other in Santa Fe. After the houses were completed, Courtney and Johns solicited straw buyers to purchase the houses, using the names and credit histories of the straw buyers to obtain financing from Plaza Home Mortgage Company and Lehman Brothers Bank. The loan applications falsely stated that the borrowers were buying the houses as primary residences, when, in fact, they had no intention of ever living in the houses. The straw buyers put no money into the transactions, did not make the mortgage payments, and were to receive $5,000 once the houses were resold. They were told that Courtney would make the mortgage payments until the houses were resold.

As a result of the false loan applications, which did not inform the lenders that the borrowers were straw borrowers, Plaza Home Mortgage Company wired two loans for $660,772.50 and $99,250 in connection with the Albuquerque house. Lehman Brothers Bank wired $641,803.34 for a loan in connection with the Santa Fe house. Courtney obtained an aggregate of $1,601,775.84 from the two mortgage lenders based on the fraudulent transactions. Courtney made mortgage payments on each property for a time after the transactions closed but ultimately stopped making payments on both, at which point the houses went into foreclosure. The mortgage companies suffered losses as a result.

The jury deliberated approximately two-and-a-half hours before returning a guilty verdict on all three counts in the indictment.

Courtney remains on conditions of release pending his sentencing hearing, which has not yet been scheduled. At sentencing, Courtney faces a maximum penalty of 20 years in prison and a $250,000 fine on each of the three wire fraud counts of conviction. Johns also is on conditions of release pending his sentencing hearing and faces the same maximum penalties.

This case was investigated by the Albuquerque Division of the FBI and is being prosecuted by Assistant U.S. Attorney Mary L. Higgins.

source: FBI



David Saks



Time&Temp Memphis

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Comment balloon 0 commentsDavid Saks • March 29 2013 12:09PM

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