David Saks: Ex-Loan Officer Nets More Than 12 Years in Prison for Mortgage Fraud

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Ex-Loan Officer Nets More Than 12 Years in Prison for Mortgage Fraud

Ex-Loan Officer Sentenced to More Than 12 Years in Prison for Mortgage Fraud Scheme Involving Dozens of South Side Properties

U.S. Attorney’s Office May 02, 2013
  • Northern District of Illinois (312) 353-5300

CHICAGO—A former loan officer was sentenced today to more than 12 1/2 years in federal prison for engaging in a mortgage fraud scheme involving 65 real estate transactions with properties located mostly in economically depressed neighborhoods on the city’s south side which netted him personally more than $700,000. The defendant, Fred Haywood, worked as a loan officer or processor for several different mortgage brokerages during the scheme, which occurred between 2001 and 2007.

Haywood, 42, of Chicago, was sentenced to 151 months in prison and ordered to pay more than $1.4 million in restitution to various lenders by U.S. District Judge Ronald Guzman. Haywood pleaded guilty in April 2012 to wire fraud.

Haywood was the last to be sentenced among six defendants who were charged in 2008 and 2009 and subsequently pleaded guilty, and his was the longest term of incarceration.

Haywood’s fraudulent acts included qualifying borrowers for loans based on false information submitted to lenders, including false information about their income, assets, employment, intention to occupy the property, and source of down payment. Court records also established that he continued his fraudulent conduct after he was indicted and while on pretrial release.

During the scheme, Haywood and his co-schemers recruited buyers with good credit to purchase properties, knowing at the time that these buyers did not have sufficient income to qualify for mortgages, had no intention of actually living in the properties they were purchasing, and had no intention of fulfilling any long-term payment obligations on the loans they obtained. Instead, he and others recruited the buyers by promising to pay them for acting as nominees and for putting the properties in their names. Haywood knew that the false statements and documents submitted to lenders were material to their decisions to make loans.

The sentence was announced by Gary S. Shapiro, United States Attorney for the Northern District of Illinois; Cory B. Nelson, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation; and Pete Zegarac, Inspector in Charge of the U.S. Postal Inspection Service in Chicago.

The government was represented by Assistant U.S. Attorney Jason Yonan.

source: FBI

David Saks

Time&Temp Memphis

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Comment balloon 4 commentsDavid Saks • May 02 2013 04:14PM


I think you will see situations like this for a long time in the future. Heard someone in our area bought 25 second homes. This has to show up somewhere.

Posted by Bill Reddington, Destin Florida Real Estate (Re/max By The Sea) over 7 years ago

Sure wasn't worth that $700,000. he made off the fraudulent acts...12 1/2 years Federal prison and $1.4 million in restitution. Unbelievable to continue the deception after being indicted. Thank you for bringing this to my attention, David. WOW! He has enough years to think about it...Mortgage Fraud...

Posted by Jane Chaulklin-Schott, TeamConnect Luxury Homes - Orlando, Florida, 32836 (TEAMCONNECT REALTY - (407) 394-9766) over 7 years ago

Mortgage fraud is common, Bill, and the penalties for it severe.

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

There are lots of criminals in prison for mortgage fraud, Jane, and many more to prosecute. The FBI is doing a great job taking loan swindlers down.

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

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