Jury Convicts Real Estate Broker of Mortgage Fraud

Allison Tussey —  October 6, 2010 — 1 Comment

Terry Hart, 58, Decatur, Illinois, was convicted for his participation in a real estate “flipping” scheme. The federal jury deliberated approximately five and one-half hours before returning guilty verdicts on all nine counts of fraud charged. Hart’s sentencing is scheduled on Jan. 20, 2011. Trial began in federal court on Sept. 21, 2010.

Hart was a licensed real estate broker who operated Hart Realty in Decatur when he was indicted in March 2008 with two co-defendants, Diane Shelton, 62, Decatur, formerly a loan officer at Staley Credit Union, Decatur, Illinois, and Mark Brown, 45, Moweaqua, Illinois, a former licensed real estate appraiser who operated a real estate appraisal business in Decatur, Illinois. The three were each charged with nine counts of mail fraud related to their participation in a scheme to defraud Staley Credit Union and various buyers of real estate in Decatur from 2002 to July 2005.

On June 22, 2009, Brown entered pleas of guilty to the nine counts of fraud. Shelton pled guilty to the nine counts on Oct. 1, 2009. Sentencing for both Brown and Shelton is scheduled on Nov. 12, 2010.

Evidence presented at trial showed the three participated in as many as 40 fraudulent real estate sale and financing transactions totaling more than $3 million in gross proceeds which generated profits to Hart of more than $600,000 and a potential loss to Staley Credit Union of more than $1 million. The defendants made false representations, including fraudulent appraisals prepared by Brown and used by Hart and Shelton to cause buyers to purchase and Staley Credit Union to finance residential real estate properties, some of which were owned by Hart and were financed at amounts substantially higher than their reasonable value. Hart and Shelton received payment of loan proceeds and paid appraisal fees and kickbacks to Brown.

The charges are the result of an investigation by the U.S. Postal Inspection Service, the Federal Bureau of Investigation, and the Illinois State Police. Staley Credit Union cooperated and provided assistance in the investigation. The case is being prosecuted by Assistant U.S. Attorney Timothy A. Bass.

Each offense of mail fraud carries a maximum statutory penalty of up to 30 years’ imprisonment and a fine of $1,000,000. Final sentences are determined by the court. In imposing sentence, the court may consider federal sentencing guidelines, which include a defendant’s criminal history, the amount of loss, and other applicable factors. 

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Allison Tussey

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One response to Jury Convicts Real Estate Broker of Mortgage Fraud

  1. Victim of Fraud October 7, 2010 at 4:10 am

    I don’t see any coverage here regarding all of the mortgage fraud that the brokers, attorneys and lenders did and continue to do against borrowers. We’re talking trillions. Could it be that perhaps you were and are a part of the problem and the fraud? Your name is perfect for you, Ms. Dollar. It’s all about the money, isn’t it? Hopefully, you’ll be watching your back when the investigations begin.

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