California Real Estate Fraud Report

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CEO of Covenant Mortgage Sentenced to Prison for Ponzi Scheme

In a case distinctly meant to serve as a deterrent to criminals engaged in the same activity, David Lee Hardin, Jr., 59, was sentenced to 41 months in federal prison for running a Ponzi scheme that caused his victims to suffer losses of $1.5 million. United States District Judge James V. Selna was the presiding judge and he ordered Hardin to provide $1.5 million in restitution.

Hardin had pleaded guilty in March 2013 to committing mail fraud.

Hardin, a resident of Coto De Caza, was the CEO of Orange County-based Covenant Mortgage, Covenant Marketing, Covenant Debt Solutions, Covenant Insurance, and HRE Mortgage. These firms were collectively offering mortgage banking and financial services firm.

According to prosecutors, Hardin solicited money from investors that were structured as loans to his businesses at fixed rates of interest. The funds were supposed to be used to originate loans, fund his debt settlement busines and to finance a housing project. But much of the money was used to pay back earlier investors, for personal expenses and to support his other companies.

David Lee Hardin was investigated by the Federal Bureau of Investigation and prosecuted by the office of Andrė Birotte Jr, the United States Attorney in Los Angeles.

© Copyright 2007-2017 Monique Bryher

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The information and notices contained on The California Real Estate Fraud Report are intended to summarize recent developments in real estate fraud, mortgage fraud, short sale fraud, REO fraud, appraisal fraud, loan modification scams, loan modification fraud and other real estate related crimes occurring in Los Angeles and California. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about real estate fraud, mortgage fraud and appraisal fraud matters or who believe they require legal counsel should seek the advice of an attorney.

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