Cary developer gets prison term for real estate fraud
by WNCN Staff
RALEIGH, N.C. -
A Cary developer was sentenced to 96 months in prison,
followed by five years of supervised release, on charges
of Conspiracy to Commit Mail, Wire, and Bank Fraud, the U.S. Attorney's office
David Lewis Johnson Jr. was
also ordered to pay $2,413,605.89 to 11 banks and lenders who were victims of
the fraud, authorities said.
The U.S. attorney's office said
Johnson, operating through E-Z N Homes, engaged in a real estate "flipping"
said Johnson and others utilized various
schemes to fraudulently obtain more than 100 properties with total mortgage
loans in excess of $20 million. The defendant used straw buyers to purchase
properties in exchange for a kickback from the loan proceeds. Johnson also
fabricated investment statements to make it appear that straw buyers
had, in some instances, $1 million in assets, authorities said. In fact, the
straw buyers recruited by Johnson did not possess the income or assets
to support the loans obtained in their names.
As a result of the scheme and Johnson's
conduct, banks and lenders issued loans to the conspirators in the amount
of approximately $9.1 million, which resulted in $3.4 million in actual losses
to the banks and lenders.