Tuesday, June 19, 2012

High-Living Steeltown Closing Agent Gets 55 Months For Looting $1.5M In Real Estate Escrow Cash, Closing Loans Without First Paying Off Existing Liens

From the Office of the U.S. Attorney (Pittsburgh, Pennsylvania):

  • A resident of Pittsburgh, Pa., has been sentenced in federal court to 55 months of incarceration on his conviction of wire fraud, United States Attorney David J. Hickton announced []. Senior United States District Judge Maurice Cohill imposed the sentence on Jason Sheppard, 31. Sheppard has been incarcerated since his arrest after he violated the conditions of his bond and fled the jurisdiction. As part of his sentencing, he was ordered to pay approximately $1.5 million in restitution.

  • According to information presented to the court, Sheppard was the president of TruClose Financial Services, which is a company that closed loans collateralized by real estate with an office in Mt. Lebanon. For much of 2009 Sheppard withdrew money from TruClose's accounts, and spent the majority of the money paying off gambling obligations and substantiating his life style.

  • In just a few months (October through December 2009) Sheppard sent nearly $600,000 to casinos from the accounts of TruClose Financial. Sheppard also wire transferred money into his wife's account and used the business's account to pay her substantial credit card bills. The shortfall that Sheppard caused is approximately $1.5 million.

  • As part of the closing of real estate transactions, representatives of TruClose signed settlement statements that represented to the lenders that the liabilities associated with the collateral would be paid off. The payment of those liabilities would ensure that the lenders would be in the first lien position and that the borrowers had only one mortgage on the property.

  • Sheppard withdrew so much money from the accounts of TruClose, however, that TruClose could not pay the liabilities that were required to be paid as part of the closings, and some of the checks used to pay the liabilities bounced. Sheppard knew that TruClose could not pay its liabilities, but he instructed the employees to close the transactions anyway.

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