U.S. Attorney’s Office
Western District of New York
(716) 843-5700
August 24, 2015

Florida Man Sentenced in Fraud Scheme Against M&T Bank

BUFFALO, NY—U.S. Attorney William J. Hochul, Jr. announced today that Frank Garcia, 54, of Florida, who was convicted of fraud affecting a financial institution, was sentenced to 87 months in prison by U.S. District Judge Richard J. Arcara. The defendant was also ordered to pay restitution totaling $10,609,903.92 of which approximately $2,500,000 million will be paid to M&T Bank.

Assistant U.S. Attorney Trini E. Ross, who is handling the case, stated that the defendant is the former owner of Federal Guaranty Mortgage Company in the State of Florida. Garcia recruited “straw buyers” to obtain mortgages from M&T Bank and other financial institutions then misrepresented their assets and liabilities, failed to record the liens on the properties in the county clerk’s office and failed to pay off pre-existing liens on the properties when they were transferred from one owner to another.

Furthermore, the defendant directed employees of Federal Guaranty Mortgage Company to prepare loan packages for borrowers. The employees were then directed to sign the documents acting as the loan officer. The loan documents were then sent to the investor financial institutions, including M&T Bank. The loan proceeds for the fraudulent loans were subsequently wired into the account of a company associated with Federal Guaranty Mortgage Company.

Ignacio Huergo, 44, of Florida, an employee of Federal Guaranty Mortgage Company, was convicted of concealing massive financial institution fraud and sentenced to two years’ probation with six months to be served on home confinement. He was also ordered to pay restitution in the amount of $736,254.25 to M&T Bank.

The sentencing is the culmination of an investigation on the part of Special Agents of the Agency Federal Bureau of Investigation.

This content has been reproduced from its original source.