Man Jailed for Orchestrating a Double Escrow Mortgage Scam

Allison Tussey —  July 29, 2013 — Leave a comment

George Anderson, 55, Copperopolis, California, a man who orchestrated a double escrow mortgage fraud scheme involving eight houses in the Las Vegas, Nevada area, has been sentenced to 5½ years in federal prison, three years of supervised release, and ordered to pay over $3.5 million in restitution.

The defendant was sentenced on Thursday, July 25, 2013, by Senior U.S. District Judge Roger L. Hunt. Anderson was indicted in March 2011 and pleaded guilty in April 2013 to one count of conspiracy to commit wire fraud.

According to the plea agreement, in about 2005, Anderson solicited four straw buyers to buy seven houses in Henderson, Nev. and one house in Las Vegas, with the understanding that Anderson would control the houses and later re-sell them at a profit. Anderson solicited a co-defendant, Andrew Swan, 38, Heyworth, Ill., to buy the houses from the straw buyers at inflated prices in exchange for Swan receiving a portion of the profit from each sale. Swan then recruited a relative to purchase several of the homes again at further inflated prices. False information was submitted to the lenders and to the escrow company in order to receive the loans and to cause disbursement of the loan proceeds to Swan’s company, Creative Capital Group, and Anderson’s company, Anderson Financial Group.

Approximately $54,000 to $86,000 from the sale of each home was dispersed to Creative Capital Group; approximately $67,000 to $164,000 from the sale of each home was dispersed to Anderson Financial Group; and approximately $19,000 to $69,000 was dispersed to each original straw buyer. The majority of the mortgage payments for the homes were not paid and the homes went into foreclosure. At least 16 mortgage loans totaling approximately $6.5 million were obtained as part of the conspiracy to defraud, and the financial institutions suffered a loss of approximately $3.5 million.

The co-defendant Swan also pleaded guilty, and was sentenced in June to 30 months in prison and ordered to pay $3.5 million in restitution.

Anderson and Swan are currently released on bond and must self-report to federal prison by Oct. 25, 2013, and Aug. 16, 2013, respectively.

“During the mid- to late 2000’s, thousands of fraudulent residential mortgage transactions in Nevada caused financial hardships for many innocent homeowners and hundreds of millions of dollars of loss to financial institutions and investors,” said U.S. Attorney Bogden. “We made this type of fraud a priority and through the end of 2012, had prosecuted 213 persons, most of who were convicted and sent to prison.”

The case was investigated by the FBI and prosecuted by Assistant U.S. Attorneys Sarah E. Griswold and Brian Pugh.

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