LAS VEGAS -- Las Vegas attorney Stanley Walton pleaded guilty Wednesday to a charge brought against him in February 2011 that he participated in a scheme to obtain mortgage loans from financial institutions using straw buyers and false loan applications, Nevada's U.S. Attorney Daniel Bogden said.
Walton, 54, pleaded guilty to one count of conspiracy to commit bank, mail and wire fraud, and is scheduled to be sentenced by U.S. District Judge James Mahan on Aug. 20. Walton faces up to 30 years in prison and a $1 million fine, and has also agreed to forfeit $750,000 in money or property.
According to the guilty plea memorandum, Walton from September 2004 through July 2007 conspired with others to fraudulently obtain residential mortgages to obtain proceeds for their personal use. Walton recruited straw buyers to purchase homes. He also intended to control the ownership interests of the homes, obtain proceeds from the mortgage loans for his own use, and later resell the houses for a profit.
Walton advised the straw buyers that he would use their names and credit to purchase the homes, and would split the profits with them when the homes were re-sold. Walton held himself out to the straw buyers as an attorney with knowledge and skill in these types of transactions, and intentionally did not disclose this plan or activity to the lenders.
Walton also made false statements and caused others to do so in the straw buyers' loan applications concerning their income, assets, intent to occupy the homes and other information. He also directed straw buyers to take steps to make it appear they intended to occupy the homes, such as by placing utilities in their names. Walton caused loan proceeds to be paid to him by falsely claiming them as attorney's fees, fraudulently diverting them through real estate agents, and fraudulently having payments made to his company, knowing the information would be concealed from the lenders.
Walton and others fraudulently purchased six homes in Henderson and three homes in Las Vegas. Walton admitted in his plea agreement that the loss caused by his criminal conduct was roughly $3.6 million.
Pamela Black, 65, a mortgage loan officer, also pleaded guilty to one count of conspiracy to commit bank, mail and wire fraud. She was sentenced last year to time served and three years of supervised release, and also was ordered to pay $1.2 million in restitution.
The investigation was conducted by the FBI, and the case is being prosecuted by Assistant U.S. Attorneys Daniel Schiess and Kathryn Newman.