The North Texas e-News reported on June 2, 2011 that Eric Rulack Farrington of Irving TX was sentenced to 132 months in federal prison for his role in a multi-million mortgage fraud scheme.
As with many similar mortgage fraud schemes, Farrington and a number of co-conspirators recruited individuals with high credit scores to act as “straw buyers” and falsely represented to them that the property would be managed by the defendants.
But the fraudsters prepared and submitted fraudulent loan documents showing inflated incomes using the names of those straw buyers in order to obtain loans on the inflated amounts based on the loan documents. Then they used the fraudulently obtained surplus loan proceeds to pay the sellers kickbacks and distributed the bulk of the proceeds among themselves. They would then allow the loan to go into foreclosure after a few payments were made on the loan.
Mr. Farrington was also ordered to pay about $2.5 million in restitution and forfeit another $1.2 million to federal authorities. Farrington and seven co-defendants had been convicted in April 2010, after a two-month long trial on various felony offenses related to the fraud scheme that they operated in the Dallas area from March 2002 until January 2006, according to the e-News story.
He was the president of Eric Farrington Seminars, Inc. and Prestige Capital Corporation, which did business as Farrington Mortgage Group. Mr. Farrington’s former fiancé, Janice Little Shepherd, 51, of Irving, Texas, a mortgage broker was also sentenced yesterday to five years in prison and ordered to pay about $1.5 million in restitution and forfeit $1.2 million to the U.S.
Kyle Colona is a contributing writer for CompliancEX and a NY based freelance writer.