Local Homebuilder Gets 14 Years Behind Bars - 8 News NOW

Local Homebuilder Gets 14 Years Behind Bars

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LAS VEGAS -- A federal judge on Monday sentenced a Las Vegas area homebuilder to 14 years in prison for selling houses at inflated prices to fraudulently obtain mortgage loans, Nevada's U.S. Attorney Daniel Bogden said.

Paul Wagner, 59, was also ordered by U.S. District Judge Miranda Du to pay $4.4 million in restitution. Wagner was convicted by a jury in October of one count of conspiracy to commit bank fraud and wire fraud, six counts of bank fraud and three count of wire fraud.

"Since the inception of our mortgage fraud program in the spring of 2008, over 200 persons have been charged with federal mortgage fraud crimes in Nevada," Bogden said. "Most of those individuals were convicted and are in prison. Wagner is the first homebuilder to be charged and convicted."

Wagner was a homebuilder in Las Vegas for 20 years, building tract homes in the northwest Las Vegas valley. From 2007 to 2009, he created a scheme to provide large cash incentives to buyers, real estate agents and others to sell his homes.

The incentives included Wagner paying buyers' mortgages and down payments, and making large cash payments to real estate agents and others to find buyers. To pay the incentives, Wagner inflated the value of the homes by causing appraisers to create false appraisals.

He concealed the incentives from the lenders, who would not have made the loans had they known about his methods. Wagner sold roughly 85 houses from March 2007 to mid-2009. Most of them went into foreclosure after Wagner stopped making the mortgage payments. Financial institutions lost more than $18 million.

The case was investigated by the FBI and prosecuted by Assistant U.S. Attorney Daniel Schiess.

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