Last Defendant Found Guilty in $30 Million Bakersfield Mortgage Fraud Scheme
|U.S. Attorney’s Office April 22, 2014|
FRESNO, CA—A federal jury in Fresno returned a verdict today in the trial of Julie Dianne Farmer, 45, of Bakersfield, finding her guilty of conspiracy to commit mail fraud, wire fraud, and bank fraud and two counts each of mail fraud and wire fraud, United States Attorney Benjamin B. Wagner announced. The charges stem from her involvement in an extensive mortgage fraud scheme that ran from January 2004 to September 2007.
“The jury’s verdict marks the end of a long and thorough investigation that resulted in the conviction of 14 defendants before this trial even began,” said U.S. Attorney Wagner. “The fraud perpetrated at the Crisp, Cole, & Associates real estate firm harmed neighborhoods, local builders, consumers, and lenders. This office has earned a national reputation for mortgage fraud prosecutions, and we will continue to bring to justice anyone who commits these crimes.”
“Today’s verdict is a bittersweet end to our extensive investigation into the large-scale conspiracy of Crisp, Cole, & Associates, also known as Crisp & Cole Real Estate (CCRE), and Tower Lending in the Bakersfield area. While millions in restitution have been ordered to be paid and a total of 14 individuals will spend time in prison for the crimes they committed, the damage that was done to the real estate industry and community in Bakersfield area will continue to have a negative impact for years to come,” said Supervisory Special Agent Jose Moreno of the Sacramento FBI’s Bakersfield Resident Agency.
According to evidence brought at trial, between January 2004 and September 2007, Farmer conspired with David Crisp, Carl Cole, and other co-defendants to commit mail fraud, wire fraud, and bank fraud and to defraud mortgage loan companies and federally insured financial institutions of money and property, by means of materially false and fraudulent pretenses, representations, and promises. Farmer was Crisp & Cole Real Estate’s (CCRE) chief operations officer and managed CCRE’s business operations and business accounts. She and co-defendants David Crisp and Carl Cole oversaw and managed the conspiracy to defraud the lenders and directed co-defendants and others in furtherance of the conspiracy. They used straw purchasers to acquire properties at inflated prices with funds borrowed from lenders, often using 100 percent financing and based on false and fraudulent loan applications. The conspirators frequently resold the properties from one straw buyer to another, each time at an inflated, higher price in order to extract the purported increased “equity” from the property for their benefit. Ultimately, most of the properties were foreclosed upon after the defendants failed to make the mortgage payments when due. Farmer is scheduled to be sentenced on July 14, 2014. She faces a maximum penalty of 30 years in prison and a $1 million fine for conspiracy to commit mail fraud, wire fraud, and bank fraud; 20 years in prison and a $250,000 for mail and wire fraud. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case is the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorneys Kirk Sherriff, Henry Carbajal, III, and Christopher Baker are prosecuting the case.
Each of Farmer’s co-defendants has previously entered pleas of guilty for their roles in the scheme and several have been sentenced. Carl Cole and David Crisp were each sentenced to 17 years and seven months in prison. Caleb Cole was sentenced to five months in prison, and Jennifer Crisp was sentenced to five years’ probation. Jayson Peter Costa was sentenced to six-and-a-half years in prison. Sentencing dates for the remaining defendants are as follows: Michael Angelo Munoz on May 5, 2014; Jeriel Salinas on May 12, 2014; and Sneha Mohammadi on June 9, 2014. Robinson Nguyen has completed his 27-month sentence.
Before David Crisp, Carl Cole, and the other defendants were indicted, five separate cases were brought, in 2009 and 2010, against five defendants who pleaded guilty to charges relating to this scheme. Three are scheduled to be sentenced on June 2, 2014: Jerald Allen Teixeira, Megan Balod, and Christopher Lance Stovall. Kevin Patrick Sluga and Leslie Sluga are scheduled to be sentenced on May 27, 2014.
This case was done in coordination with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.