2nd Suspect Goes Down In Alleged Minneapolis Flipping Scam Involving 20+ Homes

In Hennepin County, Minnesota, the Minneapolis Star Tribune reports:

• A Twin Cities mortgage broker charged in connection with a $4.9 million mortgage fraud scheme involving dozens of homes in Minneapolis and one in Golden Valley pleaded guilty today to one count of racketeering just minutes before he was to go to trial, said Hennepin County Prosecutor Tom Fabel.

• Donald Walthall, 40, of Anoka, was charged in late 2007 with one count of racketeering and 24 counts of theft by swindle, according to a criminal complaint filed in Hennepin County District Court. He pleaded guilty to one count of racketeering and accepted a 6-year prison sentence,(1) Fabel said. "He concluded that the guilt and overwhelming evidence was true," Fabel said. "He feared that if he might get a longer sentence if he went to trial."

For the story, see Broker implicated in mortgage fraud scheme pleads guilty.

Go here for earlier posts, and any available updates, on the alleged Universal Mortgage straw buyer, home flipping scams.

(1) According to the story, as president of president of Universal Mortgage Inc., a Brooklyn Park firm that also went by Superior Mortgage, Walthall led the scheme in which associates recruited straw buyers to buy Universal-owned properties at inflated prices. Walthall allegedly falsified employment histories, incomes, borrower's net worth and their intentions to live in the homes to secure larger-than-necessary loans, then took a kickback for himself. He earned $20,000 to $80,000 each time a buyer bought a Universal-owned property, Hennepin County Prosecutor Tom Fabel said.