Wisconsin Mortgage Broker Agrees To Plead Guilty & Cooperate; Feds Continue Investigation

In Wisconsin, The Janesville Gazette reports:

• "Federal prosecutors say a Lake Geneva mortgage broker swindled lending companies out of more than $4 million through the sales of 19 Walworth County properties. James J. Lytle, 33, used "straw buyers" and fraudulent loan applications to obtain properties, collect seller fees and then let the properties go into foreclosure, often at a loss to the banks, according to a plea agreement he signed May 15. Lytle is expected to plead guilty June 27 to a charge of wire fraud, a felony punishable by up to 20 years in prison and a $250,000 fine."

As part of the plea agreement, Lytle will cooperate (and possibly earn a "get-out-of-jail-free card") with investigators and testify before a grand jury if there are others charged. For more, see:

• Real estate scheme unravels
• Plea Agreement - U.S.A. vs. Lytle

Wisconsin Feds Continue Lytle Mortgage Fraud Investigation

The Week in Delavan, Wisconsin reports that a local real estate fraud case in which Lake Geneva mortgage broker James J. Lytle is the central figure, relied heavily on identity theft. At least 11 of the 19 Walworth County properties connected to the fraud scheme had straw buyers whose identities were stolen.

Lytle signed a plea agreement on May 12 and is expected to formally enter a guilty plea to a single charge of wire fraud in a Wisconsin Federal Court on June 27. He is the only person charged, but other charges are expected, according to an FBI source. For more, see Authorities believe real estate fraud scheme relied heavily on ID theft.

Go here for Plea Agreement - U.S.A. vs. Lytle or go here for other posts on this story.

Wisconsin Feds Net Another Conviction In Ongoing Mortgage Fraud Investigation

In Wisconsin, The Janesville Gazette reports that Jose Valadez has agreed to plead guilty Wednesday to a single count of federal wire fraud for using another man's identifying information and acting as a straw buyer in the purchase and financing of a home in Delavan. After purchasing the home, Valadez failed to make any payments on the mortgage loan. Reportedly, Valadez was paid $1,500 by another scheme participant for acting as the straw buyer, and the home, which ultimately went into foreclosure, now sits with weeds almost reaching to the bottom of the front windows.

This is the second man who has agreed to plead guilty in this Walworth County mortgage fraud scam. The scam involved Lake Geneva mortgage broker James J. Lytle, who has already agreed to plead guilty for his role in the scam, in which he facilitated the fraudulent sale of about 19 Walworth County properties using recruited straw buyers. For more, see Buyer charged in mortgage scam.

For story update, see Man accepts deal in mortgage fraud (The Janesville Gazette - 9-27-07 ).

Go here for other posts on this investigation.