Company President Used Office Funds to Pay Off Gambling Debts, Support Lifestyle
| U.S. Attorney’s Office August 12, 2011 |
PITTSBURGH, PA—A resident of Oakdale, Pennsylvania pleaded guilty yesterday in federal court to a charge of wire fraud, United States Attorney David J. Hickton announced today.
Jason Sheppard, 30, pleaded guilty to one count before Senior United States District Judge Maurice Cohill.
In connection with the guilty plea, the court was advised that Sheppard was the president of TruClose Financial Services, which is a company that closed loans collateralized by real estate. For much of 2009, Sheppard withdrew money from TruClose’s accounts, and spent much of the money paying off gambling obligations and substantiating his life style. In just a few months (October through December 2009) Sheppard sent nearly $600,000 to casinos from the accounts of TruClose Financial. Sheppard also wire transferred money into his wife’s account and used the business’ account to pay her credit card bills. By his own admission, the shortfall that Sheppard caused is approximately $1.4 million.
As part of the closing of real estate transactions, representatives of TruClose signed settlement statements that represented to the lenders that the liabilities associated with the collateral would be paid off. The payment of those liabilities would ensure that the lenders would be in the first lien position and that the borrowers had only one mortgage on the property.
Sheppard withdrew so much money from the accounts of TruClose, however, that TruClose could not pay the liabilities that were required to be paid as part of the closings, and some of the checks used to pay the liabilities bounced. Sheppard knew that TruClose could not pay its liabilities, but he instructed the employees to close the transactions anyway.
Judge Cohill scheduled sentencing for Dec. 1, 2011. The law provides for a total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.
Assistant United States Attorney Brendan T. Conway is prosecuting this case on behalf of the government.
The Mortgage Fraud Task Force conducted the investigation that led to the prosecution of Sheppard. The Mortgage Fraud Task Force is comprised of investigators from federal, state, and local law enforcement agencies and others involved in the mortgage industry. Federal law enforcement agencies participating in the Mortgage Task Force include the Federal Bureau of Investigation; the Internal Revenue Service, Criminal Investigations; the United States Department of Housing and Urban Development, Office of Inspector General; the United States Postal Inspection Service; and the United States Secret Service. Other Mortgage Fraud Task Force members include the Allegheny County Sheriff’s Office; the Pennsylvania Attorney General’s Office, Bureau of Consumer Protection; the Pennsylvania Department of Banking; the Pennsylvania Department of State, Bureau of Enforcement and Investigation; and the United States Trustee’s Office.
Mortgage industry members with knowledge of fraudulent activity are encouraged to call the Mortgage Fraud Task Force at (412) 894-7550. Consumers are encouraged to report suspected mortgage fraud by calling the Pennsylvania Attorney General’s Consumer Protection Hotline at (800) 441-2555.