Loan Officer and Title Agent Admit Kickback Scheme

Allison Tussey —  January 20, 2012 — Leave a comment

Daniel Douglas Boler, 42, Maple Grove, Minnesota, and Susanne Eileen Mathis, 42, Minnetonka, Minnesota, the owner of a mortgage brokerage and the owner of a title closing company, pleaded guilty in federal court in St. Paul, Minnessota, to their roles in a mortgage fraud scheme involving undisclosed kickbacks to buyers, including some in the Cloud 9 Sky Flats development.

The defendants pleaded guilty to one count of conspiracy to commit mail and wire fraud. They were charged on December 23, 2011, and entered their pleas before United States District Court Judge Paul A. Magnuson.

In their plea agreements, the defendants admitted that from 2007 through 2008, they obtained money loan proceeds under fraudulent pretenses on behalf home buyers associated with an unnamed investment group. Boler owned Team Access, a licensed mortgage brokerage, and worked as a loan officer at that brokerage. Mathis owned Trend Title and closed residential real estate transactions. Both admitted using the U.S. mail and commercial carriers, as well as interstate wire transfers, during the course of the scheme. The loss to victim lenders because of their criminal wrongdoing is between $7 million and $20 million.

To further this conspiracy, Boler prepared mortgage loan applications to secure residential mortgage loans for buyers involved in an investment group managed by a person known in court documents as Individual A. Boler admitted making false representations on those applications, including inflating the incomes of buyers and failing to disclose that buyers would receive cash kickbacks from mortgage loan proceeds. In total, Boler secured mortgage loans for the purchase of approximately 108 properties.

For her part, Mathis admittedly closed approximately 88 fraudulent transactions for the investment group, specifically concealing from mortgage lenders the fact that property purchasers received kickbacks from mortgage loan proceeds and that the buyers were often not the source of the “cash to close.” The kickbacks were disguised as prepaid management fees and facilitator fees. In addition, Mathis closed between eight and ten transactions in the Cloud 9 development, which also involved undisclosed buyer kickbacks.

For their crimes, the defendants face a potential maximum penalty of 20 years in prison.

Judge Magnuson will determine their sentences at future hearings. This case is the result of an investigation by the U.S. Postal Inspection Service and the Federal Bureau of Investigation and is being prosecuted by Tracy L. Perzel.

This law enforcement action is in part sponsored by the interagency Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. It includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and, with state and local partners, investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

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Allison Tussey

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