Ex-Lawyer Gets 21 Months In $2.4M+ Escrow Swindle; Issued Title Policies, Pocketed Payoff Proceeds Leaving Existing Mortgages Unpaid In R/E Closings

In Atlanta, Georgia, Forsyth County News reports:

• A Forsyth County man who kept a law practice in Sugar Hill will spend nearly two years behind bars on a federal mail fraud conviction. Trent Edward Wright, 38, was sentenced Friday to one year and nine months in federal prison by U.S. District Judge Timothy C. Batten Sr. Wright will also spend three years on probation following his release and must pay more than $2.4 million in restitution.

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• Acting U.S. Attorney Sally Quillian Yates said in a statement that lenders and title companies relied on Wright as their closing attorney and agent. “He was supposed to pay off all prior encumbrances on properties to secure loans and pass clear title as warranted by the title insurance,” she said. “He didn’t. Now he is going to federal prison.”

• According to the statement, information presented in court showed Wright closed about 17 loans during fall 2006 “in which lenders were falsely assured that all prior loans encumbering the properties securing their loans had been paid off.” As a result, the lenders thought they would be in the first position to recoup their loan amounts from the sale of the properties if they went into foreclosure, the statement shows.

• In addition, Wright reportedly wrote title insurance for the loans, though he failed to pay off several prior recorded liens encumbering the properties. According to the statement, “Rather than ordering title searches and requesting payoff amounts from all prior lenders as required before the new loan closings, Wright either failed to order title searches or disregarded recorded prior encumbrances, causing over $2.4 million in losses.” Wright closed his Sugar Hill law practice in 2007. In December, he surrendered his license to practice law.

• It appears Wright didn’t operate alone. Edward William Farley, 47, of Hoschton is identified in the statement as a co-conspirator in a related case.

For more, see Ex-attorney sentenced to federal prison (Forsyth man pleaded guilty in mortgage scheme).

For a press release from the U.S. Attorney's Office in Atlanta, see Former Georgia Closing Attorney Sentenced to Prison in Multimillion Dollar Mortgage Fraud.