LAS VEGAS – A lawyer involved in a mortgage fraud scheme that caused more than $30 million in losses to lenders was sentenced to more than seven years in prison, the U.S. attorney’s office for the District of Nevada announced today.
Gerry Zobrist, 43, of Las Vegas was sentenced to 87 months in prison by U.S. District Judge James C. Mahan, who also ordered Zobrist to pay approximately $31 million in restitution and to serve five years of supervised release.
Zobrist pleaded guilty in January to one count of conspiracy to commit bank fraud and wire fraud. He was allowed to self-report to federal prison by Dec. 6.
“Mortgage fraud contributed to the decimation of real property values in Nevada,” said Daniel G. Bogden, U.S. attorney for the District of Nevada. “Since 2008, we have been working vigilantly with our law enforcement partners to investigate and prosecute these fraudsters.
“Hundreds of individuals have been convicted, including lawyers, real estate agents, real estate brokers, loan officers, loan processors, and others who participated in these schemes and most of them are now serving time in federal prison.”
According to the plea agreement, from about June 2006 to May 2008, Zobrist and unnamed coconspirators solicited and paid persons with good credit ratings to serve as straw buyers to purchase homes in the Las Vegas area on behalf of Zobrist and the co-conspirators. Zobrist and the co-conspirators made offers to purchase the homes, and the sellers agreed to disburse part of the sales proceeds to real estate companies, co-conspirators and third-party entities controlled by Zobrist and the co-conspirators under the pretense that the proceeds constituted attorney’s fees, marketing fees, commissions, and other fees.
Zobrist and the co-conspirators caused to be completed and submitted mortgage loan applications and supporting documents in the name of the straw buyers, which contained false and fraudulent information concerning the straw buyers’ income, assets, liabilities, intended occupancy status, and other things.
Zobrist and the co-conspirators also caused to be submitted to the lenders documents containing false information about the source of the down payments, value of the homes, and intended disbursements to Zobrist, the co-conspirators, and straw buyers.
Using this fraudulent scheme, Zobrist and the co-conspirators purchased 144 homes and obtained mortgage loans for more than $53 million. Zobrist and the co-conspirators defaulted on the mortgage loans causing the homes to go into foreclosure, and caused the financial institutions to suffer losses of at least $30 million.
The case was investigated by the FBI and prosecuted by assistant U.S. Attorneys Daniel R. Schiess and Sarah E. Griswold.
– From news release