Mortgage loan officers indicted for $1.8 million mortgage fraud

A federal indictment unsealed April 26 charges two mortgage loan

officers with recruiting straw buyers to purchase properties at inflated prices and then

distributing the excess loan funds among the buyers and between themselves in the form of

“kickbacks.” The indictment, which was filed on April 3, 2012, charges Troy Allen Huston, age

42, and Chad Arthur Anderson, age 38, both of Chisago City, with one count of conspiracy to

commit mortgage fraud and eight counts of mortgage fraud through interstate wire. The

indictment was unsealed following the defendants’ initial appearance in federal court.

The estimated loss to mortgage lenders because of the defendants’ alleged wrongdoing

exceeded $1.8 million. Fraudulent real estate transactions purportedly involved properties in

Otsego, Oak Grove, Elk River, St. Francis, Brooklyn Park, Isanti, St. Paul, Chisago City,

Becker, Cambridge, Buffalo, Minneapolis, Zimmerman, and Albertville.

The indictment alleges that from 2006 through 2007, the defendants, who worked as loan

officers at Prestige Mortgage, a mortgage brokerage business in White Bear Lake, recruited

mainly friends and acquaintances to act as straw buyers in the purchase of several homes in the

Twin Cities. The defendants allegedly brokered the fraudulent mortgage loans by knowingly

preparing and submitting false loan applications to lenders. In addition, while acting as

signatories for Lofton Property Management, a property management business located in

Chisago City, the defendants allegedly received illicit funds from the transaction closings that

involved the fraudulently acquired real estate. During that time, Huston was also a signatory for

YES Financial, a property finance business located in Chisago City, and in that capacity, he

allegedly received loan funds, which he signed over in part to himself and others.

If convicted, the defendants face a potential maximum penalty of 20 years on each count of

mortgage fraud through interstate wire count and five years for conspiracy to commit mortgage

fraud. All sentences will be determined by a federal district court judge.

This case is the result of an investigation by the Federal Bureau of Investigation. It is being

prosecuted by Assistant United States Attorney David J. MacLaughlin.