ALBUQUERQUE—Yesterday, a federal judge
in Santa Fe, New Mexico sentenced Manuel Garcia, 70, currently residing in Los
Angeles, California, to a 13-month prison sentence, to be followed five years
of supervised release, for his bank fraud conviction. Garcia also was ordered
to pay restitution in the amount of $585,243.59 to U.S. Bank of Albuquerque,
which was formerly known as First Community Bank (FCB). Garcia was ordered to
surrender to a federal correctional institution to be designated by the U.S.
Bureau of Prisons to serve his prison sentence.
U.S. Attorney Kenneth J. Gonzales said
that Garcia was indicted and charged with six counts of bank fraud on June 7,
2011. At the time of the offenses charged in the indictment, Garcia was
president of Keyworth Mortgage Funding Group (Keyworth), a business
incorporated in New Mexico and Arizona that originated residential mortgage
loans and sold them to investors such as the Federal National Mortgage
Association (Fannie Mae). The indictment generally alleged that, between August
2009 and May 2010, Garcia fraudulently obtained money from FCB by falsely
representing that the funds were to be used to finance new residential mortgage
loans. According to the indictment, Garcia actually used the funds to pay
Keyworth’s debt to Fannie Mae.
Garcia entered a guilty plea to all six
counts in the indictment on October 14, 2011. In his plea agreement, Garcia
acknowledged that Keyworth maintained a line of credit with FCB from which it
would obtain money advances to finance the origination of mortgage loans.
Garcia admitted that he devised a scheme pursuant to which he submitted
requests to FCB for advances for non-existent mortgages, using property
addresses of prior clients. Specifically, Garcia submitted the names, addresses,
and requested loan amounts of Keyworth’s prior residential mortgage clients to
support his requests for advances. By falsely representing the properties as
new mortgages, Garcia caused FCB to wire transfer the requested advances to
Keyworth’s bank account in Arizona. Garcia admitted receiving six advances in
the aggregate amount of $1,279,650 by submitting fraudulent requests. Because
Garcia repaid $535,450 with interest to FCB as if they had been legitimate
loans, that sum was not included in the restitution that Garcia is required to
pay.
This case was investigated by the
Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorney
Tara C. Neda.
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