Expiring Statute Of Limitations To Allow Two Dozen Mortgage Fraud Suspects To Walk Free?

In Clarke County, Georgia, the Athens Banner Herald reports:

• Prosecutors may have let too much time pass to indict nearly two dozen people arrested three and a half years ago and charged with a massive mortgage fraud scheme at a Southeastern Clarke County subdivision, some defense attorneys say.

• A real estate professional tipped off Athens-Clarke police in spring 2005 that he suspected home sales at the Milford Hills subdivision [...] involved shady dealings; authorities rounded up suspects between April 2006 and June 2008, all on charges they violated the state's Racketeering Influenced and Corrupt Organizations Act.(1)

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• To prosecute a racketeering case, prosecutors must prove underlying crimes - like theft by deception, forgery, deceptive business practices and identity theft - each of which has a four-year statute of limitations in which the case must be prosecuted. The clock starts ticking when the alleged crime is committed. "It's our opinion the statute of limitation has already expired for most of the charges in this case, and if the state brings charges down the road, we would make the case it's too late to do so," said [Page] Pate, who represents Athens attorney C. Michael Rose, the closing attorney for many Milford Hills properties.

• Prosecutors have five years to bring indictments for RICO crimes, but Pate said he and other attorneys would argue a racketeering case can't be made when the statute of limitations means prosecutors can't charge for the underlying crimes.

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• Although the attorney general hasn't yet sought indictments, that doesn't mean he's decided there's no case, said [Georgia Attorney General Thurbert] Baker's spokesman, Russell Willard.(2) "The matter is still open and pending," Willard said. "If we had affirmatively decided to not bring charges, we would already have closed the file." Willard refused to say whether he agrees with defense attorneys' claims that the statute of limitations for prosecution has expired.

• Athens attorney Edward Tolley represents Brian Dupree, a former Athens businessman authorities say was at the center of the scheme to buy up Milford Hills properties, then inflate their values for resale. Tolley agreed with Pate that the statute of limitations may have passed, and if anyone's to blame for the Milford Hills fiasco, it's the banks, he said.

For more, see Time may be up on mortgage fraud cases (Attorneys point to statute of limitations).

(1) According to the story, the alleged plot, which may have netted as much as $7 million, was orchestrated by developers, real estate agents, appraisers and at least one lawyer who used fraudulent mortgage applications and property appraisals to inflate home values and defraud mortgage lenders, officials said.

(2) Initially investigated by Athens-Clarke police, this case later was taken over by the office of Georgia Attorney General Thurbert Baker, the story states.