Home Norfolk Press Releases 2013 Former Manager of Virginia Beach Mortgage Brokerage Firm Pleads Guilty to Fraud

Former Manager of Virginia Beach Mortgage Brokerage Firm Pleads Guilty to Fraud

U.S. Attorney’s Office March 18, 2013
  • Eastern District of Virginia (757) 441-6331

NORFOLK, VA—David Burrus, Jr., age 39, a former Virginia Beach resident now living in Burns, Tenneesee, pleaded guilty today in Norfolk federal court to conspiring to commit mail and wire fraud in conjunction with mortgage loans he obtained from 2005 through 2007.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Royce Curtin, Special Agent in Charge of the FBI’s Norfolk Field Office; and Joseph Clarke, Special Agent in Charge of the Office of Inspector General, Department of Housing and Urban Development, Mid-Atlantic Region, made the announcement after Burrus entered a guilty plea to count one of the seven count pending indictment before Senior United States District Judge Robert G. Doumar. Burrus faces a maximum penalty of 30 years in prison when he is sentenced on July 8, 2013.

According to court documents, David Burrus, Jr. managed and ran a Virginia Beach branch office of a mortgage brokerage firm headquartered in Tennessee from 2003 through 2007. Burrus also co-owned a title and escrow company which conducted real estate closings for many of the loans originated by loan officers supervised by Burrus. Burrus also owned another entity, Southern Living Properties, which he used to receive money from numerous fraudulent real estate transactions that he conducted.

From 2005 through 2007, Burrus sought and obtained numerous mortgage loans in both his and his spouse’s names. In the course of these transactions, Burrus agreed to buy local properties for more than the sellers’ listing prices, provided that the transactions were structured to ensure that any extra sales proceeds were paid to Southern Living Properties at the real estate closings. This ensured that, unbeknownst to the mortgage lenders, Burrus received a substantial portion of the loan proceeds when buying properties in his or his spouse’s name.

To induce lenders to approve various requests for mortgage loans, Burrus also submitted false loan applications, forged and fictitious leases purporting to show his properties were generating rental income, and false Southern Living invoices billing property sellers for work and services that had never been performed. Burrus also made material misrepresentations to mortgage lenders about his and his spouse’s income and liabilities, his rental income, and about his spouse’s intent to occupy properties purchased as her primary residence.

Shortly before the crash of the real estate market, Burrus also sought to sell properties in his portfolio to his associates and offered to pay kickbacks to buyers to facilitate sales. Rhonda Wyland, age 44, of Virginia Beach and then a loan officer working for Burrus, agreed to purchase one such property in Portsmouth, Virginia, in exchange for a kickback of $140,000. Wyland also made false statements to obtain a mortgage loan to complete this transaction and, after receiving the $140,000 kickback, defaulted upon the loan. On December 12, 2012, Wyland pled guilty to a criminal information charging her with conspiracy to commit wire fraud. Wyland faces a maximum penalty of five years in prison when she is sentenced by Chief United States District Judge Rebecca Beach Smith on April 5, 2013.

As a result of his activities, Burrus obtained mortgage loans to purchase 17 properties in Hampton Roads and then defaulted upon those loans. The known losses stemming from these loans are approximately $2,036,296.00.

This case was investigated by the FBI’s Norfolk Field Office and HUD’s Office of Inspector General. Assistant United States Attorney Robert Krask is prosecuting the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae.