Three more defendants, Milton Trice, III, Cathy Yocum and Gene W. Hite, were charged by information and have agreed to plead guilty in connection with a mortgage fraud scheme in the Greater Cincinnati area of Ohio that has resulted in more than 30 guilty pleas. Last week, sentencing began for defendants who have previously entered guilty pleas and two additional persons were indicted.
Milton Trice III, Cincinnati, Ohio agreed to plead guilty to bank fraud, conspiracy and failure to file tax returns. According to the information, he failed to file income taxes for calendar years 2001 and 2002. As part of the plea, he agreed to file tax returns and pay restitution of taxes along with interest and penalties. According to the guilty plea, Trice recruited buyers for flipped properties and performed some rehab work on properties through his company, Big and Little Construction. He was aware that fictitious and/or fraudulent appraisals were submitted to financial institutions and signed documents containing false information at closings. His guilty plea references the following transactions:
On March 29, 2002, Preferred Investments purchased 1625 Pulte Street, Cincinnati, Ohio for $21,000 and sold the property to Terry Chandler on July 13, 2002 for $79,000. The sales price was supported by an appraisal completed by Combs Appraisal Service that Trice was aware was false.
One November 15, 2002, Trice arranged for the sale of 4159 Langland Street, Cincinnati, Ohio to Earl Woods for $86,000. Trice knew that the appraisal, completed by Zajac Appraisal Services, was false.
Trice agreed, by way of the guilty plea, that as a result of his fraud, he caused an actual or intended loss to various financial and lending institutions of $2,236,770.08.
Cathy Yocum, mortgage broker, agreed to plead guilty to bank fraud and conspiracy after being charged by information. Agreed actual or intended losses to financinal and lending institutions were $255,370. According to her guilty plea, Yocum acted as mortgage broker for some of the flipped properties. She prepared false loan applications for the buyer and created false W-2 forms and bank statements overstating the borrower’s income or assets. She also knew that borrowers did not bring down payments to closing and that buyers often received undisclosed kickbacks outside of closing. The guilty plea references the following transactions:
On August 31, 2001, Christian Larson purchased 114 N. 10th Street, Hamilton Ohio for $75,000 from Ronald Trester. Yocum prepared a false loan application listing a bank account with a balance of $39,000 as the source of the down payment. Mr. Larson did not have such funds. Yocum made the down payment.
Gene W. Hite, loan processor, Cincinnati, Ohio, agreed to plead to failure to file tax returns for 2001 to 2002 after being charged by information. Between January 1, 2000 and December 2002, Hite worked for Executive Mortgage, Processing Plus and Charter First Banc (all companies of Trester) as a loan processor. According to the plea agreement, during the course of his employment, he aided and abetted others in submitting false loan packages to various financial institutions. Hite was paid $300 for each loan he processed. Further according to the indictment, he included false documents in approximately 25 to 30 of the loans he processed – including creating false bank statements and including them in the loan package.
