Michigan Home Loan Fraud Perpetrator Sentenced

Another Michigan home loan scam has been uncovered.

A 40-year-old man living on Social Security disability checks was sentenced Wednesday to 4 1/2 years in prison for conning three banks into lending him $3.8 million in a Michigan mortgage scheme that went bust.

“I was trying to make a difference for my family. I was greedy,” a sobbing Scott Ashley of Canton Township, told U.S. District Judge Gerald Rosen.

Ashley pleaded guilty on the second day of trial in November to defrauding Wells Fargo Mortgage, Huntington Bank and Comerica of $3.8 million from September 2001 through May 2002.

Prosecutors said he submitted social security number for a dead man, said he was employed in a job that paid over $1 million a year.

Moreover, he said the seller of a house in Bloomfield Hills had set aside a$1.3 million home improvement loan so Ashley could renovate four-story home and resell it quickly for $5.5-$7 million so he could make a fortune.

The mortgage fraud collapsed when he was unable to quickly sell the house and pay off $3.8 million in notes. Wells Fargo foreclosed on Ashley and auctioned the house for $2.1 million.

During Wednesday’s hearing, Ashley said the former owner of the home and an employee of one of the banks should have been charged, saying he couldn’t have pulled off the scam without their help.

He offered to give investigators documents to back up his claims.

Rosen said he considers the mortgage lender or lenders in question guilty of “benign neglect.”

“I don’t know how someone gets a home loan from a bank for a house in this condition,” Rosen said.

Assistant U.S. Attorney Paul Burakoff offered to have investigators review Ashley’s documents, he said there was no evidence that there was anyone else complicit in the mortgage scheme.

Ashley, who will serve 51-63 months in prison, must pay over $1.6 million in restitution to the mortgage lenders.

SOURCE: Detroit Free Press