Escrow Company Controller Admits Preparing Fraudulent Settlement Statements

Allison Tussey —  June 19, 2014 — 1 Comment

Joseph Gekko, 45, Yorba Linda, California, pleaded guilty to three counts of wire fraud in connection with a mortgage fraud scheme. Gekko admitted that he had prepared fraudulent HUD-1 Settlement Statements, which not only falsified the purchase prices, but the true source of down payments.

Gekko’s guilty plea marks another event in a wide-ranging series of prosecutions related to Loomis Wealth Solutions, a wealth-building program offered to the public in California, Illinois, Washington, and elsewhere from 2006 through 2008. According to indictments, persons connected to Loomis Wealth Solutions are alleged to have committed various acts of investment fraud, mortgage fraud, and money laundering.

Gekko participated in a mortgage fraud scheme that caused more than $10 million in losses to mortgage lenders and others. Gekko controlled an escrow company called Lender Services Direct (LSD), Mission Viejo, California and Tulsa, Oklahoma. According to his plea agreement, Gekko admitted to preparing fraudulent Form HUD-1 Final Settlement Statements that reflected false sales prices and that indicated down payments had been made by the nominee buyers when in fact they had not.

Gekko is scheduled to be sentenced by United States District Judge John A. Mendez on September 23, 2014. Gekko faces a maximum statutory penalty of 20 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

United States Attorney Benjamin B. Wagner announced the guilty plea.

This case is the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation. Assistant United States Attorneys Paul A. Hemesath and Jared Dolan are prosecuting the case.

Allison Tussey

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One response to Escrow Company Controller Admits Preparing Fraudulent Settlement Statements

  1. Does anyone know who Joesph Gekko”s defense attoney is?

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