NEWARK, N.J. – A federal judge has approved a request to postpone next month’s scheduled sentencing for Michael McGrath, president of U.S. Mortgage/CU National Mortgage, in the $140 million theft of credit union funds, until March 22.
McGrath, who confessed to selling mortgages for at least 26 credit unions to Fannie Mae and pocketing the money, has been free on a $1 million bond since he pleaded guilty to the massive fraud last June 11.
Federal prosecutors are said to be working on potential guilty plea from other participants in the fraud, requiring them to push the sentencing date for McGrath forward.
Under his plea agreement, McGrath has forfeited about $13 million in worth of property, leaving a shortfall of as much as $125 million of credit union funds. The credit union victims are negotiating with Fannie Mae for return of their mortgages and with CUMIS Insurance Society on potential bond claims in the case.
U.S. Mortgage and its CU National unit, which served more than 100 credit unions at one time, filed for bankruptcy last February and have been liquidated.
