Mortgage Executive Pleads Guilty to Mortgage and Wire Fraud Charges

RICHMOND, VA—Stacy Lynn Chamberlain, age 42, of Unionville, Virginia, pled guilty today to one count of mortgage fraud and one count of wire fraud.  She is facing a maximum exposure of 50 years in prison and $1,250,000 in fines when she is sentenced on July 28, 2009, by United States District Judge Richard L. Williams.

Dana J. Boente, United States Attorney for the Eastern District of Virginia; Jennifer Love, Special Agent in Charge of the Federal Bureau of Investigation; and Colonel W. Stephen Flaherty of the Virginia State Police announced today’s guilty plea.

According to court documents, in early 2004, Chamberlain planned to purchase a $489,900 house in Jarrettsville, Maryland, without putting any money down.  This required her to obtain a first mortgage loan for $440,910 and a second mortgage loan for $48,990.  Chamberlain had bad credit and so could not qualify for such a loan, so she purchased the house in the name of RLS, a nominee straw purchaser.  However, because RLS had her own financial difficulties and could also not qualify for such a loan, Chamberlain created fraudulent income and employment information for RLS that would elevate her creditworthiness to A+ level so that Fremont Savings and Loan, the lender, would not verify the information as closely. 

In reliance on the allegedly false statements, Fremont approved both loans and then sold the $440,910 first mortgage loan to Deutsche Bank and the $48,990 second mortgage loan to Citifinancial.  Within a short time after the loans were made, Chamberlain stopped making the monthly payments and both loans went into foreclosure.

As part of the plea, Chamberlain acknowledged that she had also defrauded a Richmond mortgage company, Premier Mortgage and its investors out of money and their intangible rights to the honest services of their employees by means of materially false and fraudulent pretenses, representations, and promises.  The total approximate loss to these victims was $1.4 million.

In pleading guilty, Chamberlain also admitted that in order to obtain employment and a partnership relationship with Premier Mortgage, in Glen Allen, Virginia, she misrepresented her academic credentials and previous loan production and performance levels.  In reliance on these misrepresentations, Premier entered into a contractual relationship with the defendant and provided her with substantial funds.  After Chamberlain established the relationship and obtained money and property from Premier, she then further misappropriated funds that she used for personal expenditures.    

The case is being investigated by the Federal Bureau of Investigation, Charlottesville Division, and the Virginia State Police.  Assistant United States Attorney David T. Maguire is prosecuting the case for 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.usdoj.gov/usao/vae.  Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.