Lee County Attorney Sentenced to 45 Months in Prison for Mortgage Fraud Scheme

MONTGOMERY, AL—James Boyd Douglas, Jr., 42, who previously practiced law in Lee County, Alabama, was sentenced to 45 months in prison for engaging in a multi-million-dollar mortgage fraud scheme, announced the United States Attorney’s Office for the Middle District of Alabama.

Between January 2005 and September 23, 2011, Douglas handled numerous real estate closings and real estate refinancing transactions on behalf of his clients. As part of the real estate closings, Douglas received the proceeds of new mortgage loans. Douglas was supposed to use the proceeds from new mortgage loans to repay the old mortgage loans on the properties that were being sold or refinanced. But instead of using that money to repay the old loans, Douglas embezzled approximately $2.3 million from his clients’ real estate closings over approximately six years.

Testimony in the sentencing hearing revealed that Douglas stole this $2.3 million from people and mortgage companies in order to hide his gambling addiction. “Douglas was a lawyer, and lawyers who commit crimes must be held to the same standard as everyone else and must receive the same treatment as everyone else,” stated Assistant United States Attorney, Jared Morris. “That is what we did in this case, and the sentence imposed on Mr. Douglas reflects that principle.”

Douglas was sentenced by U.S. District Judge Mark E. Fuller to 45 months in prison and ordered to pay restitution. A restitution hearing will be held at a later date.

The investigation of this case was conducted by the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Jared Morris.