From the Seattle Times:
A federal judge today is expected to sentence a former Bellevue loan officer to prison for perpetrating what prosecutors say is one of the largest home-mortgage fraud cases brought so far in Western Washington.
Christopher Brooks, 39, pleaded guilty to conspiring to commit wire fraud in connection with fraudulent loan applications on 18 Puget Sound-area homes that went into foreclosure and were sold by banks at a loss of more than $2 million.
A grand jury indicted him and his co-conspirators last summer for obtaining about $27 million in fraudulent loans on more than 50 homes in the region. Brooks admitted to paying borrowers to take part in the fraud.
In a memo to the court, Brooks’ attorney acknowledged his client could be viewed as “a poster child” for the nation’s mortgage mess but said the court should take into account the complicit behavior of the banks and give him a lighter sentence.
Read the entire story here. The attorney for the loan originator tries to put the blame on the banks for allowing so much mortgage fraud to occur during the bubble run up. As an educator, I’m amazed at how many loan originators agree with this attorney. They say, “Jillayne, the wholesale lenders encouraged us and taught us how to over state income and made us sell more of the toxic loan products to people” and there’s no talk of any personal responsibility of the individual LO’s role in the mortgage meltdown.
In the same conversation, loan originators also blame the consumer for not reading their loan documents.
How can LOs not wish any personal responsibility for themselves but demand personal responsibility for their consumers? Answer: They can’t. This is a contradiction that exposes an ugly truth.
Today the reputation of brokers, loan originators, and yes, BANKS is in the gutter. The real answer is that it’s beyond time for loan originators to stop shirking responsibility for their own conduct and embrace a higher duty to the consumer. We have to start rebuilding our reputation at some point. Let’s start right now.
Knowone disagrees that the LO made bad choices here. But with a crime this complex, and his client taking responsibility for his role in the crime, it takes more than one person to pull off a crime of this magnitude. I don’t think the LO’s are necessarily siding with him, but the banks and the consumer need to take responsibility for the roles as well.
I do believe that the los should take responsibility, but also the banks and the buyers should pay attention to what is also going onl. But to many of us believe in what we are being told because we are hoping their being honest with us.
But also what we are finding out is that there is not as many honest people as we think.
Once again, it is the responsibility of the LO to explain and help the consumer understand the loan application and documents and to put time and energy into educating their clients on the information presented to them. I don’t think the LO has any leg to stand on really when it comes to blaming the lenders/banks since they take the “trusted” information and proceed with their duties. I also don’t think it has to be only the LO’s blame, as the client could offer misinformation as well.
I am trying to figure out from the article how much time he and his wife received for their crimes. It does not sound like much at all. I recently ran into an old high school classmate at the store who starting telling me that she was losing her house because of her dishonest loan officer that got her into a house that cost $66,000.00 and she now owes $160,000.00. I could not believe that he lied to her about what type of loan she was getting and did not tell her the negative impact her loan could have on her. After a few more minutes of our conversation, she said that when she went to escrow, the escrow officer was asking her how she liked her job and noticed that she had been employed there a long time. She answered the escrow worker and said she liked her job and it was a good paying job. However, she told me that she was unemployed when she signed her loan papers and had not had a job for quite some time and in fact was on welfare.
So, I ask myself, doesn’t the borrower have some accountablility? In the case of out right fraud where you are creating straw buyers, that is a different story. That is mainly just for greed. I am glad he was caught.
There can be no single party to blame in this scenario. The Loan Officer knew that his actions could not have been legal or ethical. My concern was the lack of Dilligence on all levels. How could just one party do this? I have sat and watched over the years and had to watch as unscrupulous loan officers just shrugged their shoulders and said stupid buzz comments like “it is what it is” and “it’s about the money” with no apparent concern for the cost that both the industry and the community would end up having to bear. An example had to be set and this couldn’t have been a better choice.
Everyone in this scenario could have done something but the LO should be held accountable he did plead guilty and of course took a plea bargain that lawmakers offered. I think there should be stricter penalties here. I am so tired of us all being lumped together, everyone is responsible for their own actions, we learn that in kindergarten. But due to the magnitude of mortgage fraud across the nation we are all suffering. I believe the few that are still fighting to do a good job for consumers in this business will drag us out of the mud.
Here we go Attorney and Brooks has to recall when he and his legal begal try to blame the structure of the loan business and the ultimate temptations that is offered to us everyday to committ fraud both of these people must know, when you point your finger at a weakness you must know that there are 4 pointing back at you, so guess what you loose. Professioinally some cases aren’t worth a legal representative, if you committ fraud be prepared to be punished?
Looks like Brooks is being made an example of, it’s unfortunate more people haven’t been prosecuted in these fraudulent schemes. Unfortunately the people’s lives he’s affected will be damaged indefinately. One of the main benefits to this job is providing a unique service in your community, when done right can be very gratifying. I hope the Fed’s continue their persuit of people like Mr. Brooks.