Business Law Case

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Case No. 1: Countrywide Loan Officer convicted of Mortgage Fraud charges Summary Between January 2005 and December 2007, Paige Kinney, aka Jamie Lee Lawler, a mortgage loan officer for Countrywide Home Loans, played a major role in a mortgage fraud scheme that amounted to $40 million in fraudulent loans and targeted both the company she worked for and other several lenders. The way the scheme would process consisted of gathering straw buyers to purchase the intended properties, in which they did not have any intention to live in or be responsible for the loan payment. Kinney would then obtain mortgage financing for the buyers and properties, by forging and modifying their documents, for which the lenders would attribute loans that exceeded the sales prices of the homes. That excess between sales price and loan amount, called “cash-back” would then be redirected to Kinney’s bank account, and would be used for personal expenses, make mortgage payments, and compensate the “buyers,” among other things. She ended up continuing her illicit activities after being indicted, but ended up being sentenced to 15 years in jail and pay a restitution of $22 million. Facts 1. Between January 2005 and December 2007, Paige Kinney, a mortgage loan officer, committed mortgage fraud that caused lending institutions to issue $38,745,215.00 in fraudulent loans. 2. In order to obtain financing, Kinney altered and forged documents, such as bank statements, sources of down payments, and loans documents. 3. During the same time, she also obtained $8,754,485.17 as “cash back” from those loans, and diverted it into bank accounts controlled by her and other conspirators. 4. Kinney used the “cash back” money for personal expenses, purchase of luxury vehicles, jewelry, and homes in Phoenix and San Diego, to make mortgage payments, and to compensate the “buyers.” 5. Kinney continued to

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