Prison for $16 Million in Sham Condo Sales

     HOUSTON (CN) – A husband and wife were ordered to pay more than $16 million in restitution for defrauding lenders through “sham sales” of condos and houses, federal prosecutors said.
     Derwin Frazier, 45, pleaded guilty to conspiracy to commit money laundering. His wife Veronica, 44, pleaded guilty to conspiracy to commit wire fraud, the U.S. Attorney’s Office said.
     The Fraziers live in Pearland, a Houston suburb.
     U.S. District Judge Lee Rosenthal sentenced Derwin Frazier to 7 years in federal prison and ordered him to pay $16.3 million in restitution. Veronica was sentenced to 1 year in federal prison and ordered to pay $321,000 in restitution.
     “The charges stem from a scheme to defraud residential lenders in connection with single-family residences and individual condominium purchases in a building located at 917 Main in Houston, aka The Kirby Lofts,” prosecutors said in the statement. “The Kirby Lofts and other single family homes were sham sales.
     “From about December 2004 to October 2006, Derwin Frazier recruited individuals with good credit to act as borrowers in applications for mortgage loans to purchase units in Kirby Lofts and elsewhere.
     “Co-conspirators, such as Brenda East, 51, assisted these ‘straw borrowers’ with providing false information and documents, including bogus tax letters and false verifications of bank balances and employment, to induce lenders to fund residential home purchases.
     “Derwin and Veronica Frazier submitted invoices for payment from loan proceeds and used the money to pay themselves and straw borrowers from loan proceeds.”
     East was sentenced to 57 months in federal prison after pleading guilty to conspiracy to commit wire fraud.
     Another defendant, Duane Wardell, 50, of Palestine, Texas, also pleaded guilty to conspiracy to commit wire fraud. He will be sentenced on Dec. 14, prosecutors said.

%d bloggers like this: