When the FBI Comes Calling…®
MORTGAGE FRAUD (Continued)
Mortgage Fraud Prosecuted Under 18 U.S.C. § 1001 (False Statements)
For a more in-depth explanation of what constitutes false statements, please look at our false statements page, here.
United States v. Lefkowitz, 125 F.3d 608 (8th Cir. 1997).
For details of the defendant's scheme, see the discussion of this case in conjunction with 18 U.S.C. § 225, supra. As far as section 1001 is concerned, it is only a minor part of the case. It highlights, however, how a seemingly minor detail can allow the AUSA to prosecute a defendant for mortgage fraud under section 1001.
On the two counts of violating section 1001, the defendant was convicted of "knowingly and willfully using false documents in a matter within the jurisdiction of an agency of the United States (the IRS) when he cause [the company] to file false non-profit tax credit applications with [a housing agency]." Id. at 617 n.2. On appeal, the defendant argued that he did not know that the applications would list the National Development Council as a project partner, but there was ample evidence offered to permit a reasonable jury to find knowing and willful violations of section 1001.
Mortgage Fraud Prosecuted Under 18 U.S.C. § 1006 (2007) (Credit Institution Fraud)
18 U.S.C. § 1006 (2007).
The Crime
It is a crime for a person who is
- an officer, agent or employee of or connected in any capacity with
- the Federal Deposit Insurance Corporation,
- National Credit Union Administration,
- Office of Thrift Supervision, any Federal home loan bank,
- the Federal Housing Finance Board,
- the Resolution Trust Corporation,
- Farm Credit Administration,
- Department of Housing and Urban Development,
- Federal Crop Insurance Corporation,
- the Secretary of Agriculture acting through the Farmers Home Administration or successor agency,
- the Rural Development Administration or successor agency, or
- the Farm Credit System Insurance Corporation,
- a Farm Credit Bank,
- a bank for cooperatives or any lending, mortgage, insurance, credit or savings and loan corporation
- or association authorized or acting under the laws of the United States or any institution, other than an insured bank (as defined by 18 U.S.C. § 656), the accounts of which are insured by the Federal Deposit Insurance Corporation or by the National Credit Union Administration Board,
- or any small business investment company,
- with intent to defraud any such institution or any other company, body politic or corporate, or any individual, or to deceive any officer, auditor, examiner or agent of any such institution or of department or agency of the United States,
- make any false entry in any book, report or statement of or to any such institution, or
- without being duly authorized,
- draw any order or bill of exchange,
- make any acceptance, or
- issue, put forth or assign any note, debenture, bond or other obligation, or draft, bill of exchange, mortgage, judgment, or decree, or,
- with intent to defraud the United States or any agency thereof, or any corporation, institution, or association referred to in this section,
- participate or share in or receive directly or indirectly any money, profit, property, or benefits through any transaction, loan, commission, contract, or any other act of any such corporation, institution, or association.
The Punishment
The punishment for a violation of section 1006 is
- a fine of not more than $1,000,000, imprisonment for not more than 30 years, or both.
Case Law Interpreting Section 1006
United States v. McLean, 131 Fed. Appx. 34 (4th Cir. 2005).
Details of the scheme in this case can be found in the discussion of section 1010, below. The defendants in the case were charged with, in part, "making false entries on monthly status reports required by HUD in violation of 18 U.S.C. § 1006." McLean at *8. One of the defendants was convicted on the charge, but the court unfortunately does not discuss the conviction.