Indianapolis case involved 15 people, 99 fraudulent loans
Friday, January 19, 2007
Inman News
A former Indianapolis police officer
who moonlighted as an appraiser was sentenced to 57 months in federal prison
Wednesday and ordered to pay $1.1 million in restitution after he was convicted
of conspiracy, money laundering and wire fraud charges related to inflated
mortgage loans.
Michael C. Smith, 45, who was fired
from the police department after a jury convicted him in September, was one of
three people sentenced this week in two mortgage fraud schemes in which 15
people have been sentenced to federal prison.
The schemes involved mortgage
brokerages Quantum Investments and American Savings Mortgage, which used
inflated appraisals to obtain loans on properties in excess of their true
value, prosecutors said.
Prosecutors have said American
Savings Mortgage obtained financing for residential properties in Indiana
cities including Indianapolis, Marion, Fairmount, Kokomo and Anderson,
generating 99 fraudulent loans that resulted in losses of $3.4 million.
Kenneth McKinney, 40, president of
American Savings Mortgage, was sentenced in October to seven years in prison
and ordered to make $3.4 million in restitution payments after pleading guilty
to participating in the scheme.
The two other defendants sentenced
this week, Joseph Britton, 47, of Fishers, and Mark Speckman, 48, of
McCordsville, allegedly controlled three companies used to disburse
fraudulently obtained loan proceeds -- Aspen Group, Pacific Group, and Home Source Investment LLC.
The two bought properties in the names of the businesses that were sold at
approximately twice their true value, prosecutors said.
Britton and Speckman were sentenced
Tuesday to 33 months in prison, and ordered to pay restitution of
approximately $900,000 for their roles in providing properties for sale through
American Savings Mortgage and then paying kickbacks to others in the scheme.
Susan W. Brooks, United States attorney for the Southern
District of Indiana, said companies owned by Britton and Speckman had been
cited by the city more than 450 times for health and safety violations on their
investment properties.
***
Send tips or a Letter to the Editor to matt@inman.com or call (510) 658-9252, ext. 150.
Copyright 2007 Inman News
