A federal judge late last month sentenced to 30 months in prison and one year of supervised release a former lawyer who admitted he'd lied banks to induce them to make loans.
Warren P. Joblin was also ordered to pay $159,000 to the defrauded lenders, which included Citicorp Dime Bancorp in New York and Comfed Savings Bank, which was based in Lowell, Mass. The government closed Comfed in 1991.
Officials in the U.S. Attorney's Office declined to discuss the case.
Mr. Joblin pleaded guilty in March to charges arising from mortgage transactions involving Swiss Conservative Group, which allegedly arranged financing for distressed homeowners in Connecticut, New York, and New Jersey by pretending to sell their homes.
Prosecutors alleged that Swiss had deceived lenders into believing that they were granting mortgages to buyers of the properties. In fact, the government said, the distressed homeowners retained control and were responsible for all mortgage payments, though they were unqualified for the loans. The formal buyers, often family members or friends, incurred no cost or risk.
Swiss charged a fee of 20% of the "purchase price" of the property, and Mr. Joblin received $159,000 in fees for helping on 59 of the company's 200 deals.
The federal investigation into Swiss has produced 10 convictions, including those of six lawyers, a mortgage broker, and two mortgage lenders.
One of the Swiss Conservative principals, William B. Steiger, pleaded guilty July 11 to one count of conspiracy, one of making false statements, and four counts of bank fraud. Mr. Steiger admitted that lenders did not know the loans were refinancings rather than sales.