CLOSING ATTORNEY WHO MISHANDLED MORTGAGE FUNDS SENTENCED TO 21 MONTHS IN PRISON

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Education & Training with The Real Estate Mart of Tennessee, Inc. TN LIC# 290452

Attorney Who Mishandled Mortgage Funds Sentenced to 21 Months in Federal Prison

U.S. Attorney’s Office October 07, 2011
  • District of Connecticut (203) 821-3700
 
David B. Fein, United States Attorney for the District of Connecticut, announced that BRIAN P. McMANUS, 43, of Fairfield, was sentenced today by Senior United States District Judge Ellen Bree Burns in New Haven to 21 months of imprisonment, followed by three years of supervised release, for misappropriating more than $1 million in funds during real estate transactions he handled.

According to court documents and statements made in court, McMANUS, who operated a law practice in New Haven, engaged in a series of fraudulent transactions in his capacity as the closing attorney on a number of real estate transactions.

Specifically, McMANUS failed to pay off existing mortgages on the properties involved in the real estate transactions in a timely fashion and illegally used mortgage funds that had been deposited into his IOLTA account for other purposes.

On July 22, 2008, McMANUS handled a real estate closing involving the refinancing of a residential property located in Greenwich. At the time of the closing, there was an outstanding mortgage on the property in the amount of approximately $2 million that was to be paid off using funds being provided by a different lender as part of the refinancing transaction. However, rather than paying off the existing mortgage on the Greenwich property, McMANUS used more than $1.45 million of the new mortgage monies that had been transferred to his IOLTA account to pay off outstanding mortgages from prior, unrelated real estate transactions he had handled, to make monthly payments on the outstanding Greenwich mortgage loan that was to have been paid off in full, and to pay personal and business expenses.

On June 24, 2011, McMANUS waived his right to indictment and pleaded guilty to one count of bank fraud.

Today, Judge Burns ordered McMANUS to pay restitution in the amount of $2,041,417.41, of which approximately $568,000 has previously been deposited with the clerk of the court.

U.S. Attorney Fein noted that McMANUS has withdrawn from the practice of law and the Connecticut Superior Court has appointed a trustee to oversee the closing of his practice.

This matter was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant United States Attorney John H. Durham.

In July 2009, the U.S. Attorney’s Office and the Federal Bureau of Investigation announced the formation of the Connecticut Mortgage Fraud Task Force to investigate and prosecute mortgage fraud cases and related financial crimes occurring in Connecticut. Citizens are encouraged to report any suspected mortgage fraud activity by calling 203-333-3512 and requesting the Connecticut Mortgage Fraud Task Force, or by sending an e-mail to ctmortgagefraud@ic.fbi.gov.

The Connecticut Mortgage Fraud Task Force includes representatives from the U.S. Attorney’s Office; Federal Bureau of Investigation; Internal Revenue Service - Criminal Investigation; U.S. Postal Inspection Service; U.S. Department of Housing and Urban Development, Office of Inspector General; Federal Deposit Insurance Corporation, Office of Inspector General; and State of Connecticut Department of Banking.

Courtesy FBI
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Topic:
ActiveRain Community
Location:
Tennessee Shelby County Memphis
Groups:
Crime
Realtors®
Tags:
real estate fraud

Comments 2 New Comment

Show All Comments
Rainmaker
78,158
Melissa Hailey
Collin County Realtor-Lucas, Murphy, Plano, Parker
Coldwell Banker Jane Henry Realtors (Wylie TX & LovejoyISD)

WOW!  You are on a roll.  Can you believe these fraud cases?  It's so sad to think of the mess this type of thing has caused.  If people would just act with honesty and integrity in everything they do, the world would be a better place.

October 07, 2011 06:40 PM
Rainmaker
1,269,049
David Saks
Memphis, Tennessee
The Real Estate Mart of Tennessee, Inc.

Wishful thinking, Melissa, but I agree. Money has a powerful odor and attracts real vermin. Skunks who abuse the public trust are even more acrid. 

October 07, 2011 06:49 PM
Show All Comments
Rainmaker
1,269,049

David Saks

Memphis, Tennessee
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