2 Local Mortgage Loan Officers Plead Guilty in $1.8M Scheme
Two Chisago City residents pleaded guilty this week to fraudulently obtaining $1.8 million in mortgage loans in a scheme that involved 32 homes in Minnesota.
Chad Anderson, 38, and Troy Huston, 42, each face up to five years in prison for one count of conspiracy to commit mortgage fraud. The two were charged in April.
According to the U.S. Attorney’s Office in Minnesota, Anderson and Huston admitted that in 2006 and 2007, they brokered numerous fraudulent mortgage loans by submitting false loan applications to lenders. At the time, the two worked as loan officers at Prestige Mortgage, a mortgage brokerage company in White Bear Lake.
The two allegedly recruited relatives and friends to act as “straw buyers” and purchase properties at inflated prices. Anderson and Huston then distributed the excess loan funds among themselves, the straw buyers, and others involved in the scheme.
The scheme involved a total of 32 homes located in Otsego, Oak Grove, Elk River, St. Francis, Brooklyn Park, Isanti, St. Paul, Chisago City, Becker, Cambridge, Buffalo, Minneapolis, Zimmerman, and Albertville, according to the U.S. Attorney’s Office. All of the mortgage loans involved have gone into default, causing losses to the mortgage lenders that exceed $2.5 million—which, in addition to the loan amounts, includes expenses incurred by the lenders because of properties going into default.
Anderson and Huston will be sentenced at a later date, which is yet to be determined.