Contractor Admits Builder Bailout Scheme

Allison Tussey —  August 3, 2011 — Leave a comment

William E. Baker

During his plea hearing in district court, Baker admitted that he and others conspired with Garret Griffith Gililland III, 30, formerly of Chico, to artificially inflate the sales prices of new homes sold to Gililland‘s buyers. After close of escrow, Baker & Baker Construction would rebate significant sums of money to a front company controlled by Gililland. On one occasion, Baker misrepresented the purpose of the payments to Gililland‘s company as “improvements for three houses.” In fact, Gililland‘s company made no improvements to homes sold by Baker to Gililland‘s buyers. In court, Baker admitted to knowing that the lenders financed the properties at 100 percent of the inflated purchase price. He admitted that he intended to defraud lenders by inducing them to fund home loans in greater amounts than the real sales price. Baker also admitted that had the lenders known that the sales prices were inflated, they would not have approved the loans.

Other significant pleas in this case include those of Gililland, Anthony G. Symmes, 60, Paradise; Shane Burreson, 38, Orland, the president of Nor Cal Innovative Investments Inc. Remaining defendants include Leonard Williams, 49, Sacramento, a licensed real estate professional; Brandon Resendez, 32, Chico; and Kesha Haynie, 39, Chico, a licensed real estate professional. Trial of the remaining defendants is scheduled for September 12, 2011. The remaining defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

Sentencing for Baker is scheduled for November 18, 2011. He faces a maximum statutory penalty of 20 years in prison, a $250,000 fine, and three years of supervised release. 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 is another significant plea in an ongoing investigation of mortgage fraud involving subjects located throughout California and other states,” said U.S. Attorney Wagner. “The results we are seeing in this, and other of our mortgage fraud cases, would not be possible without the hard work of special agents of the FBI, the IRS, and our local law enforcement partners, such as the Butte County District Attorney’s Office.”

This case is the product of an investigation by the Federal Bureau of Investigation, the Internal Revenue Service-Criminal Investigation, and the Butte County District Attorney’s Office. Assistant United States Attorney Russell L. Carlberg is prosecuting the case.

This case is part of the work being done by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force 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, to 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. One component of the FFETF is the national Mortgage Fraud Working Group, co-chaired by U.S. Attorney Wagner. For more information on the task force, visit StopFraud.gov.

, 65, Chico, California, pleaded guilty to one count of mail fraud for his role in a multi-million dollar “builder bailout” mortgage fraud scheme in Chico, California.

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Allison Tussey

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