Loan Officer to Spend 4 Years in Prison for Fraud

Allison Tussey —  November 19, 2012 — Leave a comment

Pervaiz Arshad, 58, Annandale, Virginia, was sentenced to 48 months in prison, followed by three years of supervised release, for his role in fraudulent mortgage loan transactions involving nine homes in northern Virginia and nearly $1.7 million in losses to lenders, and for his role in attempting to obtain a fraudulent passport for a co-conspirator fleeing to Canada.  

Arshad was also ordered to pay restitution to the victim lenders and to forfeit the proceeds of his crimes.

The defendant was sentenced by United States District Judge T. S. Ellis III. As previously reported by Mortgage Fraud Blog, Arshad pleaded guilty to conspiracy and passport fraud charges on Aug. 22, 2012.

According to court documents, Arshad was a loan officer for Annandale-based E-Star Lending and recruited an individual to serve as a straw buyer in fraudulent real estate transactions designed to enrich himself and others. The properties, owned by co-conspirators, were sold to the straw buyer at a profit. Arshad ensured the straw buyer would qualify for the 100-percent financing used to buy the properties by reporting false employment and income information on the loan applications.

Conspirators set up fake companies to verify the false employment information and further deceive the lenders. No payments were made on the loans, and Arshad intended for the straw buyer to flee to Canada before the fraud was discovered.

Arshad was indicted in this case in 2010, after he fled to Pakistan to avoid prosecution. He was arrested in July 2012 when authorities discovered him on a flight into Dulles International Airport. Arshad is the sixth individual associated with E-Star Lending to be convicted of mortgage fraud related charges since 2008.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia; James W. McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office; and Gary Barksdale, Inspector in Charge of the Washington Division of the United States Postal Inspection Service, made the announcement.

This case was investigated by the FBI’s Washington Field Office and the U.S. Postal Inspection Service. Assistant United States Attorney Paul J. Nathanson is prosecuting the case on behalf of the United States.

Allison Tussey

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