2 Sentenced in Elaborate Mortgage Fraud Scheme

admin —  February 16, 2010 — Leave a comment

Kurt Warren Heintz, 39, Grand Blanc, Michigan, formerly the owner of Great Lakes Broker Funding in Grand Blanc, Michigan, and James Fish, 41, Royal Oak, Michigan, formerly a licensed real estate broker in the State of Michigan, were sentenced (Henitz, Fish) to 65 months in the custody of the Bureau of Prisons on one count of Financial Institution Fraud in violation of Section 1344 of Title 18 of the United States Code and 30 months in the custody of the Bureau of Prisons on one count of Financial Institution Fraud in violation of Section 1344 of Title 18 of the United States Code, respectively.

On February 6, 2009 and February 4, 2009, respectively, Heintz and Fish pleaded (Heintz, Fish) guilty to a one-count Information charging that they had devised and executed a scheme to defraud Indy Mac Bank though the use of a fraudulent mortgage loan application based on a false and inflated property appraisal. Although Heintz and Fish pleaded guilty to one count of Financial Institution Fraud, they agreed to be held responsible for the full extent of their scheme to defraud financial institutions in the Flint, Michigan metropolitan area. As previously reported on Mortgage Fraud Blog and per court documentation, this scheme to defraud began in May of 2005 and continued through 2007. In addition to IndyMac Bank the victim financial institutions included, Fifth Third Bank, Bank of America, Independent Bank, Mercantile Bank, and Union Federal Bank. The Federal Bureau of Investigation conducted of a review of the mortgages obtained in the course of this scheme to defraud and calculated the loss to these and other lending institutions at more than $14.4 million.

In sentencing Heintz and Fish, Honorable Sean F. Cox, United States District Judge carefully reviewed and summarized the facts of the case, as well as the background and circumstances of each defendant. Judge Cox expressed his “shock” that Heintz had chosen to devise and commit such a serious and devastating crime. In sentencing Fish, Judge Cox said his sentenced had been heavily influenced by the fact that Fish had stolen the identity of other appraisers and used them on fraudulent appraisals. In addition to the millions of dollars lost by lending institutions, Judge Cox noted the devastation caused to entire neighborhoods, the financial cost to unsuspecting purchasers and the damaged and destroyed careers of innocent appraisers.

In addition to their custodial sentences, Heintz was ordered to pay, jointly and severally with Fish, $14,467,546.50 in restitution to various financial institutions, and Fish was ordered to pay, jointly and severally with Heintz, $4,992,400. Each was ordered to pay a $100 special assessment and must serve three years of supervised release upon the completion of their custodial terms.

The sentences were announced today by United States Attorney Barbara L. McQuade. Ms. McQuade was joined in the announcement by Andrew G. Arena, Special Agent in Charge, Federal Bureau of Investigation, Detroit Field Office.

FBI Special Agent in Charge Arena said that, “These charges and sentences underscore the seriousness with which the United States Attorney’s Office, the Federal Bureau of Investigation, area financial institutions, as well as other local, state and federal law enforcement agencies and regulators, view allegations of mortgage fraud. Mortgage fraud continues to have significant and devastating consequences for the Michigan economy. It is important that investors, consumers and real estate professionals, as well as the public in general, recognize that schemes to defraud involving mortgages and real estate transactions will result in the incarceration of the offenders.”

This matter was initiated and investigated by the Federal Bureau of Investigation.

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