Federal Jury Stays Late to Convict Defendant of Mortgage Fraud

Allison Tussey —  January 13, 2014 — Leave a comment

Randy Lee Wilkins, 47, Gilroy, California, after a four-day trial, was found guilty by a federal jury who stayed until 5:15 p.m. to return the verdict.

The defendant was found guilty on all counts in connection with a mortgage fraud scheme: one count of conspiracy to commit wire fraud and bank fraud, three counts of bank fraud, and three counts of wire fraud. United States District Judge Lawrence J. O’Neill committed Wilkins into custody immediately following the jury verdict.

According to court documents and evidence presented at trial, between April 2006 and May 2007, Wilkins conspired with a business partner, Joseph George Tkac, and another individual to fraudulently obtain mortgages for three houses: E. Ashlan Avenue, Fresno, California, S. Phillip Avenue, Fresno, California, and N. Adoline Avenue, Fresno, California. Wilkins and his partners carried out the scheme through a business called JR Properties & Investments. They also obtained a home equity line of credit on one of the houses.

Wilkins had applications for the home loans submitted in Tkac’s name, who had better credit. The loan applications contained false statements concerning Tkac’s income, assets, liabilities, and intent to occupy the properties as his personal residence. Although the loans were taken out in Tkac’s name, the properties were later transferred to JR Properties and Investments.

In addition to obtaining the loans from financial institutions based on false statements and misrepresentations, Wilkins received kickbacks funded by loan origination fees and other charges. The proceeds from the home equity line of credit, and other funds received through the scheme, ended up in either the JR Properties and Investments bank account or in a personal account controlled by Wilkins. Notably, the kickbacks were not disclosed to the lending institutions on the HUD-1 settlement statements as required.

According to evidence presented at trial, Wilkins used the loan proceeds for his living expenses and to gamble at a local casino. For several months Wilkins made payments on the real estate loans to the lenders. Ultimately, however, he stopped making payments and the properties went into foreclosure. As a result of Wilkins’s conspiracy and scheme to defraud, the lenders on the home loans suffered more than $615,000 in losses.

Wilkins is scheduled to be sentenced on March 24, 2014 by United States District Judge Lawrence J. O’Neill. Wilkins faces a maximum sentence of 30 years in prison and a $1 million fine on each count. 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.

Tkac previously pleaded guilty to conspiracy to commit mail fraud and bank fraud for his involvement in this scheme. He is scheduled to be sentenced on February 24, 2014. (Case no. 1:10-cr-00152 LJO).

United States Attorney Benjamin B. Wagner announced the verdict.

This case is the product of an investigation by the Federal Bureau of Investigation. Assistant United States Attorneys Kirk E. Sherriff and Grant B. Rabenn are prosecuting the case.

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Allison Tussey

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