Escrow Theft Gets Man Jail Time

admin —  January 15, 2010 — Leave a comment

Hubert Edward Ellzey, Jr., 68, Metairie, Louisiana, was sentenced in federal court to thirty-five (35) months in prison for bank wire fraud.  In addition, U. S. District Court Judge Eldon E. Fallon imposed three (3) years of supervised release following the term of confinement, during which time the defendant will be under federal supervision and risks an additional term of confinement should he violate any terms of his supervised release. Ellzey was also ordered to pay $777,000.00 to Commonwealth Land Title Insurance Company of Louisiana in restitution.

As previously reported on Mortgage Fraud Blog, according to court documents, Ellzey was employed as an independent title agent for Commonwealth Land Title Insurance Company of Louisiana and as such was responsible for disbursing funds from the sale of refinanced property. Usually these funds were wired to Ellzey into a special escrow account. At some point after June of 2005, Ellzey began to use the funds provided and wired by the lenders to close out mortgages for his own personal use and would then float the funds from subsequent closings to pay off the prior refinanced mortgages.

The scheme was discovered when after Hurricane Katrina hit New Orleans in August, 2005 all closings came to a halt and Ellzey was unable to cover some of the funds converted for his own use and to close the pending mortgages.

During the course of the scheme Ellzey defrauded Commonwealth Land Title Insurance Company of Louisiana of approximately $77,000.00.

U. S. Attorney Jim Letten made the announcement. The case was investigated by the Federal Bureau of Investigation. The case was prosecuted by Assistant U. S. Attorney Juan M. Masini.

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