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Mortgage lender gets 42 months for $12M fraud

courier-journal.com | December 11, 2015

By Andrew Wolfson

A once high-flying California mortgage lender was sentenced Thursday to three-and-a-half years in prison for defrauding two Louisville banks out of $12.7 million.

But Brady Bunte's lawyer said he was prosecuted because he was a "small fish" while the government bailed out bigger lenders because they were "too big to fail."

Bunte, who was once featured on the society pages of an Orange County magazine, also was ordered to pay more than $10 million in restitution to PNC Bank. He was sentenced by Chief U.S. District Judge Joseph McKinley Jr.

Bunte admitted that in 2007 and 2008 his company, Trust One Mortgage, submitted fraudulent funding requests for nonexistent mortgage loans to PNC and National City Bank in Louisville.

Pleading unsuccessfully for probation, his federal public defender, Patrick Bouldin, said in a presentencing memo that Bunte fell victim to the real estate collapse of the mid-2000s.

"Mr. Bunte did not steal money and put it into his pocket" and "personally did not profit anywhere near $12 million," Bouldin said.

Rather, he said, his client falsified loans to infuse cash into the company in hopes that the real estate market would turn around quickly enough to allow him to repay them, and so he could continue in business.

"His plan did not work, and as a result, he is before this court," Bouldin said.

The plea for leniency was partially successful as the government had asked McKinley to impose a sentence of five years.

Bouldin argued that the case was "full of sad irony" because that big banks, including National City, which was acquired by PNC, received federal TARP funds while only "small fish" like Bunte "ever had to face a judge and the prospect of a prison sentence."

Long before ever engaging in any criminal conduct, Bouldin said, Bunte ran his company as a legitimate, legal and successful mortgage loan business over 15 years.

Now, after selling all his assets to repay as much as he could to PNC, he is indigent, divorced and lives with his elderly and ill mother, Bouldin said in the memo. He was a world sports fishing champion and owned chip and tequila companies.

"While not an excuse for his conduct, Mr. Bunte actions were influenced heavily by the unforeseen financial circumstances that nearly destroyed the country's real estate market," Bouldin said.

Bunte admitted that from March 2007 through November 2008 he caused his mortgage company to submit fraudulent funding requests on its warehouse line of credit to National City Bank. The fraudulent funding request caused National City Bank to incur a loss of $12,744,678.16.

This case was investigated by the FBI and prosecuted by Assistant U.S.Attorneys Bryan Calhoun and Amanda Gregory.

 

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CFLA was founded by the Nation's Leading Foreclosure Defense Attorneys back in 2007 to serve the Foreclosure Defense Industry and fight pervasive Bank Fraud. Since opening our virtual doors, CFLA has rapidly expanded to become the premier online legal destination for small businesses and consumers. But as the company continues to grow, we're careful to hold true to our original vision. For us, putting the law within reach of millions of people is more than just a novel idea—it's the founding principle, just ask Andrew P. Lehman, J.D.. With convenient locations in Houston and Los Angeles, you can contact Our National Account Specialist and General Manager / Member Damion W. Emholtz at 888-758-2352 for a free Mortgage Fraud Analysis or to obtain samples of work product, including cutting edge Bloomberg Securitization Audits, Litigation Support, Quiet Title Packages, and for more information about our Nationally Accredited and U.S. Department of Education Approved "Mortgage Securitization Analyst Training Certification" Classes (3 days) 24 hours for approved CLE & MCLE Credit (Now Available Online).

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