Insurance Agent Sentenced for Mortgage Fraud

admin —  February 17, 2010 — Leave a comment

Roseann Wagner, 45, Prior Lake, Minnesota, was sentenced in federal court for stealing more than $470,000 designated for payment of title insurance premiums and recording fees. Wagner was sentenced to 20 months in prison on one count of wire fraud and one count of failure to file a tax return.

In her plea agreement, Wagner admitted operating a scheme to defraud mortgage lenders, borrowers, and a title insurance underwriter from January 2007 to December 2007. Wagner, a licensed insurance agent, owned and operated Tri-Star Title, a title insurance agency. In a mortgage transaction, title insurance protects the lender’s financial interest in the property. The person or entity obtaining a mortgage is required to pay title insurance premiums and other recording fees as part of the closing costs. The cost of those premiums is included in the amount financed by the lender.

As previously reported on Mortgage Fraud Blog, Wagner accepted more than $470,000 from lenders at hundreds of residential real estate closings, knowing the money was to be used to pay closing costs, including title insurance premiums and recording fees. Instead, however, she used the money for her own benefit. Initially, because of Wagner’s fraud, title insurance premiums, title search costs, and recording fees on hundreds of residential mortgage transactions went unpaid. However, when Stewart Title Guaranty Company, the Texas title insurance underwriter for Tri-Star, discovered Wagner had misappropriated the funds, it absorbed the losses of all borrowers and paid the title insurance premiums and other expenses, though it was under no obligation to do so.

Wagner also failed to file a tax return or pay taxes on more than $270,000 in 2007. The tax loss from her failure to report income was at least $70,000.

Wagner was charged on October 13, 2009, and pleaded guilty on October 23, 2009.

Following sentencing, Julio La Rosa, Special Agent in Charge of the St. Paul Field Office of the Criminal Investigation Division of the Internal Revenue Service, which led the investigation in this case, said, “Honest and law abiding citizens are fed up with those who use deceit and fraud to line their pockets with other people’s money as well as skirt their tax obligations.”

This case was the result of an investigation by the Internal Revenue Service-Criminal Investigation Division and the Minnesota Department of Commerce. It was prosecuted by Assistant U.S. Attorney Timothy C. Rank.

Be Sociable, Share!


Posts Google+

No Comments

Be the first to start the conversation.

Leave a Reply

Text formatting is available via select HTML.

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>