California Man Pleads Guilty to Federal Bank Fraud Charges

U.S. Attorney’s Office October 14, 2011
  • District of New Mexico (505) 346-7274
 
ALBUQUERQUE—This morning in Albuquerque federal court, Manuel Garcia, 69, who now resides in Los Angeles, California, entered a guilty plea to an indictment charging him with six counts of bank fraud.
 
At sentencing, which has yet to be scheduled, Garcia faces a maximum sentence of 30 years’ imprisonment, five years of supervised release, and a $1,000,000 fine. Under the terms of his plea agreement, Garcia will pay restitution in the amount of $585,243.59 to US Bank of Albuquerque, formerly known as First Community Bank (FCB). Garcia remains on conditions of release under pretrial supervision pending his sentencing hearing.

U.S. Attorney Kenneth J. Gonzales said that Garcia was indicted and charged with six counts of bank fraud on June 7, 2011. At the time of the offenses charged in the indictment,

Garcia was president of Keyworth Mortgage Funding Group (Keyworth), a business incorporated in New Mexico and Arizona that originated residential mortgage loans and sold them to investors such as the Federal National Mortgage Association (Fannie Mae).

The indictment generally alleged that, between August 2009 and May 2010, Garcia, fraudulently obtained money from FCB by falsely representing that the funds were to be used to finance new residential mortgage loans.

According to the indictment, Garcia actually used the funds to pay Keyworth’s debt to Fannie Mae.

In his plea agreement, Garcia acknowledged that Keyworth maintained a line of credit with FCB from which it would obtain money advances to finance the origination of mortgage loans.

Garcia admitted that he devised a scheme pursuant to which he submitted requests to FCB for advances for non-existent mortgages, using property addresses of prior clients.

Specifically, Garcia submitted the names, addresses, and requested loan amounts of Keyworth’s prior residential mortgage clients to support his requests for advances.

By falsely representing the properties as new mortgages, Garcia caused FCB to wire transfer the requested advances to Keyworth’s bank account in Arizona.

Garcia admitted receiving six advances in the aggregate amount of $1,279,650 by submitting fraudulent requests.

Because Garcia repaid $535,450 with interest to FCB as if they had been legitimate loans, that sum is not included in the restitution that Garcia will have to pay.

This case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Tara C. Neda

Courtesy FBI

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4 Comments on MORTGAGE COMPANY PRESIDENT PLEADS GUILTY TO FEDERAL BANK FRAUD CHARGES

OCT
17
2011
146,232 Points Called Shot Master

seems that mortgage fraud is on the increase.
8:49pm • #1
334,005 Points Outside Blog

Finding the mortgage fraud is on the increase... I always let my clients know that totally honesty is the way to go!  I am confident that things will get better with the banking industry... it takes time.
8:55pm • #2
869,026 Points 4 Featured Posts Outside Blog

With so many in the director's chair involved, I agree, James. This type of fraud should be classified as a disease by the World Health Organization because of it's frequency.
8:56pm • #3
869,026 Points 4 Featured Posts Outside Blog

Honesty always is, Liz. 1.3 mil is quite a loss to FCB. I feel sorry for any financial institution conducting legitimate business that becomes the unfortunate target of this type fraud, or any type of fraud. I've reviewed hundreds of cases and I'm horrified by it. The public perception of banking is greatly diminished. It's similar to the public perception of the police when they abuse their position as police officers to arrest someone under false pretenses, or commit fraud and violence. Our national banking system depends on the public’s confidence just like our system of justice, and that those who enforce the law must also obey the law. When directors of financial institutions commit fraud commerce is ruined because trust has been destroyed. Only when the crime has been forgotten can trust be restored. and that won't happen on a wide scale in this lifetime in this nation because of the events of the last seven years. Millions of our citizens have tragically been ruined by lenders subscribing to intentionally deceptive practices. They continue.....ad infinitum.....to delude with dishonesty. Sadly, nothing can stop it. While the FBI and our nation's fraud investigators are focusing on one case another is always taking place, somewhere. Any banker has a great responsibility managing money. If they could tend money like a cotton field it would grow and provide rewards. But they pluck money, like cotton, before it's ready for harvest and kill the plants that would have been the righteous abundance of a good harvest.
9:34pm • #4


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The information and notices contained in this blog are intended to summarize recent developments and news. The posts are presented as general research and information. These posts are not intended, nor should be regarded, as legal advice. Some blog posts concern allegations made in civil lawsuits and in criminal indictments in United States Courts. All persons are presumed innocent until convicted of a crime and proven guilty. Readers who have particular questions or who believe that they need legal counsel should seek the advice of a qualified attorney. It is neither the editor's or author's intention to create a confidential relationship or any broker-client relationship via communication from this site at any time. Please consult with your state real estate board if questions & answers in the education section conflict with the laws of your region or if you need clarification regarding their applicability or how they may govern the services that you provide.

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