Retired Cowboys Watch Ex-Gridiron Teammate "Mean Gene, The Hitting Machine" Get Sacked For 54 Months After Guilty Plea For Quarterbacking Dallas-Area Equity Stripping Straw Buyer Ripoff Of Financially Strapped Homeowners

From the Office of the U.S. Attorney (Dallas, Texas):

• Eugene Lockhart, Jr. was sentenced [...] to 54 months in federal prison and ordered to pay approximately $2.4 million in restitution following his guilty plea to one count of conspiracy to commit wire fraud, stemming from his leadership role in a massive mortgage fraud scheme that he and others ran in the Dallas area from approximately 2002 to 2005.
  
  Lockhart, of Carrollton, Texas, is the last of 10 defendants who were convicted in the scheme to be sentenced.
  
  Lockhart played for the Dallas Cowboys from 1984 to 1990 and used his name and fame, according to evidence in the case, to get business and further the scheme.

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• Lockhart was involved with real estate entities, some formed by him and Tisdale, which had names that were often derived in some fashion from a reference to the Dallas Cowboys, including America’s Team Mortgage; America’s Team Realty; America’s Team Funding Group; Ace Mortgage; Cowboys Realty; Cowboys Mortgage; and KLT Properties. Tisdale was involved with Pinnacle Development and Realty Corporation; Atilla Capital Corporation; and KLT Properties. Jones was involved with Pinnacle Development and Realty Corporation and Atilla Capital Corporation.
  
  The defendants ran a scheme in which they located single-family residences for sale in the Dallas area, including distressed and pre-foreclosure properties, and negotiated a sales price with the seller. They created surplus loan proceeds by inflating the sales price to an arbitrary amount substantially more than the fair market value of the residence.
  
  Generally, they recruited individuals to act as nominee or “straw purchasers” or “straw borrowers,” promising to pay them a bonus or commission of between $10,000 and $20,000 for their participation in a particular real estate transaction. The conspirators caused the loan applications for each straw borrower to include false financial information, often including inflated false income figures to conceal the borrower’s true financial condition so that the lender would more likely approve the loan. The conspirators concealed from the lenders the true status, financial conditions, and intentions of the named borrowers, knowing that loans would not likely be approved if the lender knew the true role, credit worthiness, and risk of each straw borrower.
  
  The conspirators falsely represented in loan documents that the straw purchaser intended to use the property as their primary residence, intentionally concealing from the lender that each straw borrower viewed himself as an “investor,” who never intended to occupy the home.
  
  Some of the conspirators also caused bogus and fraudulent “marketing fees” to be listed on loan closing documents to provide a means for the conspirators to receive surplus/excess loan proceeds.
  
  The scope of the conspiracy involved approximately 54 fraudulent residential property loan closings resulting in the funding of approximately $20.5 million in fraudulent loans. The actual loss to lenders is nearly $3 million.

For the U.S. Attorney press release, see All Defendants Sentenced in More Than $20 Million Mortgage Fraud Scheme Led by Former Dallas Cowboy Eugene Lockhart.

See also, Bloomberg: Ex-Dallas Cowboy Lockhart Gets 4 1/2 Years for Scam:

• U.S. District Judge Jorge A. Solis in Dallas handed down the punishment [] as several one-time Cowboys players, including Hall of Fame defensive lineman Randy White, looked on. Lockhart, once known as “Mean Gene the Hitting Machine,” pleaded guilty last year to one count of conspiracy to commit wire fraud, days before the scheduled start of his trial.

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• Appearing with White at the sentencing [] were fellow defensive lineman Ed “Too Tall” Jones, receiver Drew Pearson and defensive back Everson Walls.
  
  White, who in 1994 was inducted into the Pro Football Hall of Fame in Canton, Ohio, and is a member of the Cowboys’ Ring of Honor, testified for Lockhart at [] sentencing. "I don’t think him having to go to jail is going to help anyone,” White told the court. He called his former teammate “an honest guy.”