Mortgage Exec Charged With Fraud

A former president of Consumer Mortgage LLC was charged with fraud this week. The man used funds from mortgage investors to pay for gambling debts, house parties and music festivals.

The SEC has charged a former mortgage company president with fraud after it was found that he misused funds allotted for mortgage investments. The man, who used to head Consumer Mortgage LLC, took more than $30 million from hundreds of investors in order to supply funds for homebuyers that could not qualify for traditional mortgages. Instead, the money was used to pay off more than $10 million of the man�s gambling debt, to throw lavish parties and to support local music festivals. The investors will assured that they would see a 30% to 60% return on their investment within the course of a few years.

Previous investors that were making trouble also benefited from the new investors, since their money was paid back from the money taken in the new scam. Investigators think that the man began the new scam in order to specifically raise money to pay back the original investors, while paying off debts and support a rich lifestyle. A court date has not yet been set for the trial.\r\n