Thursday, Sept. 5, 2013 | 5:40 p.m.
Las Vegas lawyer Gerry Zobrist, who pleaded guilty in January to his involvement in a mortgage fraud scheme that cost lenders $30 million, has been sentenced to more than seven years in prison, Nevada’s U.S. Attorney Daniel G. Bodgen announced today.
U.S. District Judge James C. Mahan also ordered Zobrist, 43, to pay about $31 million in restitution and to serve five years of supervised release. Zobrist pleaded guilty in January to one count of conspiracy to commit bank fraud and wire fraud.
According to a plea agreement, Zobrist and unidentified co-conspirators solicited and paid people with good credit ratings to serve as straw buyers to purchase homes in the Las Vegas area from about June 2006 to May 2008. Zobrist and his co-conspirators offered to purchase the homes, while the sellers agreed to give part of the sales proceeds to real estate companies, co-conspirators and third-party entities controlled by Zobrist and the co-conspirators.
All of this was done under the pretense that the proceeds constituted attorney’s fees, marketing fees, commissions and other fees, according to the plea agreement. Zobrist and his co-conspirators then used the straw buyers’ names to submit false and fraudulent information on mortgage loan applications. They also submitted to the lenders documents containing false information about the source of the down payments, value of the homes and intended disbursements.
Zobrist and his co-conspirators bought 144 homes and obtained mortgage loans for more than $53 million using this scheme, officials said. Zobrist and his co-conspirators ultimately defaulted on the mortgage loans, causing the homes to go into foreclosure and the financial institutions to lose more than $30 million.
He has been allowed to self-report to federal prison by Dec. 6, 2013.