Former Owner of Mortgage Lending Company Charged with Bank Fraud
LOUISVILLE, KY—The former owner of an Orange County, California mortgage lending company was charged by federal grand jury in Louisville, with devising a scheme to defraud and to obtain moneys owned or under the custody and control of National City Bank and PNC Bank, financial institutions, of $12,000,000 by submitting fraudulent funding requests for nonexistent mortgage loans announced David J. Hale, United States Attorney for the Western District of Kentucky.
According to the single count indictment, Brady Bunte, age 49, of Orange County, California, from March 2007 through November 2008, caused his company, Trust One Mortgage, LLC (Trust One), to submit approximately 53 fraudulent funding requests on its warehouse line of credit to National City Bank (NCB) and PNC Bank (PNC). Each of the approximately 53 fraudulent funding requests was for a nonexistent mortgage loan. The fraudulent funding requests caused NCB to issue approximately $17,900,000 in moneys to Trust One.
Further, from approximately March 2007 through October 2008 the fraudulent funding requests submitted by Trust One and Bunte caused NCB to suffer a loss of approximately $12,000,000. NCB’s warehouse lending operations were located in Louisville, Kentucky. In or around October 2008, PNC acquired NCB.
As a warehouse lender, NCB provided revolving, short-term loans, known as warehouse lines of credit, to mortgage lenders. The mortgage lenders, such as Trust One, were required to pay off specific loans issued on its warehouse line, by warehouse lenders, within a set period of time or when the warehouse lender demanded payment.
Bunte was charged in a sealed indictment on September 18, 2014. He was arraigned on the charge yesterday in U.S. District Court located in Santa Ana, California, and was released on a $100,000 third-party bond.
If convicted at trial, Bunte could be sentenced to no more than 30 years in prison, a five year period of supervised release and fined $1,000,000.
This case is being prosecuted by Assistant United States Attorneys Bryan Calhoun and Amanda Gregory and is being investigated by the Federal Bureau of Investigation (FBI).
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.