Tuesday, July 23, 2013 | 3:13 p.m.
A Las Vegas homebuilder who defrauded banks and lenders of more than $8 million was sentenced by a federal judge Monday to 14 years in prison and was ordered to pay a $4.4 million fine.
Paul Wagner, 56, was convicted of numerous financial crimes by a federal jury in October 2012 and sentenced on Monday by U.S. District Judge Miranda Du. Wagner was convicted of one count of conspiracy to commit bank fraud and wire fraud, six counts of bank fraud and three counts of wire fraud, Nevada's U.S. Attorney Daniel Bogden announced Tuesday.
Wagner's conviction and sentencing makes him the first Nevada homebuilder since 2008 to be successfully prosecuted for mortgage fraud, Bogden said.
Under the scheme, which began in March 2007 and ended sometime in mid-2009, Wagner would offer large cash incentives to buyers, real estate agents and others to sell his homes. The incentives included Wagner paying buyers' mortgage payments for several months, paying buyers' down payments, and giving large cash payments to real estate agents and others to find buyers for his homes.
To pay for all the incentives, Wagner inflated the value of his homes by convincing appraisers to draft false appraisals, officials said.
He concealed the incentives from lenders, who officials say would not have made the loans had they known his methods.
Wagner used this scheme to sell 78 houses, many of which went into foreclosure when he stopped making payments. The tract homes he built were in the northwest valley.
Du also sentenced another Las Vegas man to over four years in prison and $1.3 million in damages after being convicted of several counts of mortgage fraud, Bogden said.
Oudom Somee, 46, was sentenced to 51 months in prison and five years of supervised release and was fined $1.3 million in restitution after using friends and family as straw buyers to purchase homes in the Las Vegas area, then skim money from loan payments, Bogden said. Somee was convicted by a federal jury in November 2012 on one count of conspiracy to commit mail fraud, wire fraud and bank fraud, as well as eight counts of wire fraud, one count of bank fraud and one count of mail fraud.
According to officials, Somee recruited friends and family members with high credit scores to purchase Las Vegas area homes, telling them that he would control the property and that the buyers would not need to make mortgage payments. Somee and several co-conspirators then prepared fraudulent loan applications, submitted them to banks and pocketed the money, officials said.
Homes purchased would generally go into foreclosure after Somee made a handful of mortgage payments, officials said.
Eight homes in Las Vegas and Henderson were purchased under Somee's scheme, costing various banks more than $2.6 million in losses. Officials also prosecuted a loan officer and escrow officer involved in the scheme.