Loan Officers Sentenced to Prison for Mortgage Fraud Involving Los Angeles African-American Churches
Two men who operated a mortgage fraud scheme that targeted mostly African-American churches in the Los Angeles area have been sentenced to federal prison and fined.
Paul Ryan, a former mortgage loan officer with Broadway Federal Bank, and mortgage broker Chester Peggese received sentences of 18 months and one year and one day, respectively. Paul Ryan was ordered to pay $353,925 in restitution to Broadway Federal Bank and Chester Peggese was ordered to pay the bank $4.2 million. Ryan had pleaded guilty to one count of receiving bribes and rewards as a bank employee two years ago.
Peggese acted as a “consultant,” targeting Los Angeles churches to either acquire new property or to refinance their mortgages. At the time Broadway Federal Bank was paying rebates to brokers who brought them loan business; Ryan had been accused of demanding that all or part of the rebate money be paid to him in exchange for processing and approving the bank loans. The scheme ran from 2007 until March 2010.
The case was the result of a multi-agency investigation of the following federal agencies: Federal Bureau of Investigation (FBI), Internal Revenue Service’s Criminal Investigation Division, Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), and Federal Deposit Insurance Corporation’s Office of Inspector General.
Read the original article in The Scanner.