Hubert Edward Ellzey, Jr., 68, Metairie, Louisiana, pled guilty in federal court before U. S. District Judge Eldon E. Fallon to one count of Wire Fraud.
According to court documents, Ellzey was employed as an independent title agent for Commonwealth Land Title Insurance Company of Louisiana and as such was responsible for disbursing funds from the sale of refinanced property. Usually these funds were wired to Ellzey into a special escrow account. At some point after June of 2005, Ellzey began to use the funds provided and wired by the lenders to close out mortgages for his own personal use and would then float the funds from subsequent closings to pay off the prior refinanced mortgages. The scheme was discovered when after Hurricane Katrina hit New Orleans in August 2005 all closings came to a halt and Ellzey was unable to cover some of the funds converted for his own use and to close the pending mortgages. During the course of the scheme Ellzey defrauded Commonwealth Land Title Insurance Company of Louisiana of approximately $775,000.00.
The count carries a maximum statutory penalty of twenty (20) years of confinement, a fine of $250,000.00 and three (3) years of supervised release following any term of confinement. The court set a sentencing date for January 14, 2010, at 2:00 PM.
U. S. Attorney Jim Letten announced the guilty plea.
The case was investigated by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U. S. Attorney Juan M. Masini.