Banking Law

When we last looked in on Taiwan Lee a couple of years ago, he had "vanished" while out on parole, then resurfaced after committing multiple instances of mortgage fraud in Colorado. He was caught, and became a poster child for the burgeoning problem in Denver (and elsewhere) of professional criminals passing along to their brethren behind bars the ins and outs of mortgage fraud.

Recently, the Denver Business Journal gave a summation of the sentences handed out to Taiwan and his cohorts.

A Centennial man has been sentenced to more than 12 years in federal prison for mortgage fraud, federal officials said Wednesday.

Torrence James, 44, pleaded guilty on Jan. 10 to wire fraud and money laundering charges related to mortgage fraud. He was sentenced Wednesday by Chief U.S. District Judge Edward Nottingham to 151 months in prison, according to a statement from the U.S. Attorney's Office in Denver.

According to the plea agreement, James and co-defendant Ronald Fontenot conducted a scheme to obtain loans using false statements to lenders about the purchase and sale of real estate. Lenders lost a total of $3.7 million through the scheme, federal officials said.

James was among seven people charged in the scheme. The other defendants and their federal prison sentences were: Nicole Puller, 34 months; Glenn Puller, 12 months; Talita James, 24 months; Taiwan Lee, 30 months; Cindy Ingram, 28 months; and Fontenot, 72 months.

Unfortunately, the breakup of Tawain's Gang is not likely to be the end of the road for mortgage fraudsters in the Mile High City. Our secret sources inform us that Taiwan's second cousin (twice removed), "Formosa Lee," is being groomed to take over the family business, but is waiting until the "Paulson Blueprint" is put into effect. The expected runoff of renegade OTS personnel who will be purged in the planned liquidation of that agency is expected to pump up the expertise of mortgage fraud gangs throughout the country and to fuel a new wave of residential real estate related crime. Formosa plans to pick off a few OTS outriders (I can recommend a few myself) to round out his mortgage fraud "tong."

After all, as Housing Wire pointed out last Friday, mortgage fraud is a "growth business."