Man Gets Prison For Using Straw Buyers to Defraud Lender and Fannie Mae

Allison Tussey —  September 5, 2014 — Leave a comment

Peter Allen, Southfield, Michigan, has been sentenced to 21 months in prison followed by two years of supervised release for his participation in a conspiracy to commit bank fraud wherein Allen and his co-conspirators defrauded National City Bank and Fannie Mae.

The defendant was charged in a superseding indictment on July 16, 2013, and pleaded guilty to conspiracy to commit bank fraud on April 29, 2013. Allen was also ordered to pay $96,400 and $97,900 in restitution, respectively, to National City Bank and Fannie Mae, the financial institutions that he helped defraud.

Court documents state that from approximately January 2006 to December 2008, Allen and his co-defendants conspired to defraud lending institutions by obtaining mortgage loans using fraudulent information. The charging documents allege that Allen and others devised a scheme wherein they purchased property for approximately $5,000 to $40,000 per home, and then recruited straw buyers to submit fraudulent loan applications for home mortgages in exchange for a fee.

According court documents, Allen assisted in executing the relevant scheme by meeting with straw buyers and encouraging them to participate in the scheme. The loss resulting from Allen’s criminal activities is approximately $231,000.

The Justice Department announced the sentence.

This case was investigated by the FBI, Internal Revenue Service – Criminal Investigation and the Drug Enforcement Administration. Senior Litigation Counsel Corey Smith and Trial Attorney Mark McDonald of the Tax Division are prosecuting the case.

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