David Isaac Lapin, 51, Houston, Texas, a former broker connected with the failed Premiere Holdings of Texas LLC, has been convicted and sentenced to prison for failing to disclose a crime to authorities and concealing material facts from investors. Lapin pleaded guilty on February 16, 2010, to a criminal information charging him with misprision of a felony. He was sentenced to 36 months in federal prison without parole and fined $60,000 in connection with the operation of Lapin and Wigginton Asset Management, a subsidiary of Premiere Holdings LP, a real estate investment program. As previously reported on Mortgage Fraud Blog, Lapin and co-defendants, attorney Ted Russell Schwartz Murray and Jeffrey Carl Wigginton Jr.,were indicted in August 2006. Murray was convicted following a lengthy trial and is serving a 20-year prison term. Wigginton pleaded guilty and is serving a three-year sentence.
In pleadings filed with the court, Lapin admitted that he and his associates made false representations to investors in a real estate investment program when they promised (1) 12% interest; (2) 1st liens on real estate; (3) 72-hour liquidity; and (4) 70% loan to value ratio. In fact, so-called interest payments were actually set aside from a portion of the investor’s principle and returned to them as interest, many loans were not secured by 1st liens on real estate and many loans were not based on a 70% loan to value ratio. Lapin also admitted that he and his co-defendants failed to disclose to investors the fact that loans on certain projects were actually in default at the time the funds of new investors were placed in these loans. Lapin concealed these facts from investors.
Lapin acknowledged that he and Wigginton failed to live up to their fiduciary responsibilities to investors. As such, Lapin and Murray failed to disclose to investors that Premiere Holdings charged fees ranging from 15 -25% from investor funds.
On bond since the time of his arrest following the return of the indictment in 2006, Lapin was ordered into the custody of the U.S. Marshals Service immediately following the hearing to begin serving his prison term.
The announcement was made by United States Attorney José Angel Moreno.
This investigation was conducted by the United States Postal Inspection Service, the Internal Revenue Service and the United States Department of Labor. Assistant U.S. Attorneys Cedric L. Joubert and Steve Corso prosecuted the case.