Atlanta Man Sentenced to Prison for Fraud Related to Failed Omni National Bank

BRENT MERRIELL, 38, of Atlanta, Georgia, was sentenced today by United States District Judge Jack T. Camp to federal prison on charges of making false statements to the Federal Deposit Insurance Corporation (FDIC) and aggravated identity theft.

“The FDIC serves a critical role by insuring the assets of hard-working Americans. Mr. Merriell used stolen identities, created fictitious buyers, and negotiated phony short sale deals for properties, all in an effort to defraud FDIC of millions of dollars he owed on mortgages,” said United States Attorney Sally Quillian Yates. “This double fraud has landed him in federal prison.”

MERRIELL was sentenced to three years and three months in prison to be followed by five years of supervised release. MERRIELL was convicted of these charges on March 23, 2010, upon his plea of guilty.

According to United States Attorney Yates, the charges and other information presented in court: MERRIELL obtained millions of dollars in loans from Omni National Bank as mortgages on numerous properties. Omni later failed and was taken over by the FDIC. Beginning in October 2009, MERRIELL faced foreclosure on 14 different properties subject to Omni mortgages. In response, MERRIELL asked the FDIC to forgive $2.2 million in loan payments and instead allow him to “short sell” the properties to seven new purchasers at significantly reduced amounts. The seven new purchasers, however, were phony: the seven names MERRIEL presented to the FDIC were, in fact, stolen identities whose names were forged on sales contracts and counterfeit loan commitment letters. Under this scheme, if law enforcement had not intervened, Merriell would have retained control of the properties, and could then rent them for amounts in excess of the substantially reduced mortgage payment, or resell them at a profit.

A “short sale” occurs when a lender such as Omni Bank agrees to the sale of property—on which the current owner has defaulted—to a third party for less than the full amount due on the loan. Lenders are willing to accept “short sales” as a means of mitigating their losses on troubled loans. The MERRIELL “short sale” fraud was discovered through a sting operation conducted by the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) with the assistance of the FDIC.

Other Omni-related prosecutions to date include:

JEFFREY L. LEVINE, 68, of Atlanta, Georgia, who pleaded guilty on January 14, 2010, to causing materially false entries that overvalued bank assets to be made in the books, reports, and statements of Omni, is scheduled to be sentenced on September 14, 2010, at 2:00 p.m., before United States District Judge Jack T. Camp.

DELROY OLIVER DAVY, 37, of Lithonia, Georgia, who pleaded guilty on May 11, 2010, to bank fraud and conspiracy to commit bank fraud, mail and wire fraud in connection with a scheme to fraudulently obtain millions of dollars of mortgage loans from Omni and other lenders, is scheduled to be sentenced on September 14, 2010, before United States District Judge Jack T. Camp.

CHRISTOPHER BERNARD LOVING, 32, of McDonough, Georgia, who pleaded guilty on June 24, 2010, to making false statements to agents of the Office of the Special Inspector General for the Troubled Asset Relief Program and the FDIC in connection with an investigation regarding Omni construction contracts, is scheduled to be sentenced on August 24, 2010, before United States District Judge Jack T. Camp.

MARK ANTHONY MCBRIDE, 44, of East Point Georgia, was sentenced on April 1, 2010, to over 16 years in prison for obtaining fraudulent loans from many lenders, including Omni.

This investigation is part of President Barack Obama's Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

This case was investigated by special agents of a mortgage fraud task force formed for Omni-related cases, made up of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), Housing and Urban Development Office of Inspector General (HUD-OIG), the United States Postal Inspection Service, the Federal Deposit Insurance Corporation Office of Inspector General (FDIC-OIG), and the Federal Bureau of Investigation. The task force is continuing to investigate a number of Omni-related matters.

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Atlanta Man Pleads Guilty to Making False Statements to the FDIC and Aggravated Identity Theft

BRENT MERRIELL, 37, of Atlanta, Georgia, pleaded guilty today in federal district court to charges of making false statements to the Federal Deposit Insurance Corporation (FDIC) and aggravated identity theft.

United States Attorney Sally Quillian Yates said, “This case demonstrates our resolve to prosecute those who attempt to cheat the FDIC as that agency works to secure the assets of hard-working Americans deposited in this country’s banks.The FDIC has limited resources to guarantee deposits across this country, and we will not ignore attempts by criminals like Merriell to steal money intended to protect honest citizens.”

According to United States Attorney Yates, the charges and other information presented in court: MERRIELL obtained millions of dollars in loans from Omni National Bank before Omni’s failure and takeover by the FDIC on March 27, 2009.Beginning in October 2009, when he was facing foreclosure on 14 different properties, MERRIELL asked the FDIC to forgive $2.2 million in Omni loan payoffs and allow him to “short sale” two properties each to seven new purchasers at greatly reduced amounts.

A “short sale” occurs when a lender agrees to the sale of property—on which the current owner has defaulted—to a third party for less than the full amount due on the loan.Lenders are willing to accept “short sales” as a means of reducing their losses on bad loans and assisting the distressed property owner. In this case, MERRIELL attempted to arrange short sales in the names of people whose identities had been stolen, and he submitted forged and counterfeited sales contracts and loan commitment letters to the FDIC in support of the sales.MERRIELL was arrested before he could complete these sales and ruin the credit of the persons whose identities he stole.

MERRIELL was indicted on the charges in December 2009. He could receive a maximum sentence of up to 30 years in prison and a fine of up to $1,000,000 for the false statements crime, as well as a mandatory consecutive sentence of two years in prison and a fine up to $250,000 for the aggravated identity theft.In determining the actual sentence, the Court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.

Sentencing is scheduled for May 25, 2010, at 2 p.m. before United States District Judge Jack T. Camp.

Additional Omni-related prosecutions to date include:

MARK ANTHONY MCBRIDE, 43, of East Point, Georgia, who pleaded guilty on April 4, 2009, to fraudulently obtaining millions of dollars in mortgage loans from Omni and other lenders, is scheduled to be sentenced on April 1, 2010, at 2:00 p.m., before United States District Judge Jack T. Camp. MCBRIDE remains in jail while awaiting sentencing.

JEFFREY L. LEVINE, 68, of Atlanta, Georgia, who pleaded guilty on January 14, 2010, to causing materially false entries that overvalued bank assets to be made in the books, reports and statements of Omni, is scheduled to be sentenced on May 25, 2010, at 10:00 a.m., before United States District Judge Jack T. Camp.

DELROY OLIVER DAVY, 37, of Lithonia, Georgia, was charged in a Criminal Information on December 18, 2009, with bank fraud and conspiracy to commit bank, mail, and wire fraud in connection with a scheme to fraudulently obtain millions of dollars of mortgage loans from Omni and other lenders. At his initial appearance, DAVY waived indictment and is now scheduled to plead guilty on May 11, 2010, at 2 p.m.before United States District Judge Jack T. Camp.

These cases are being investigated by Special Agents of a Mortgage Fraud Task Force formed for Omni-related cases, made up of the Housing and Urban Development (HUD) - Office of Inspector General, the United States Postal Inspection Service, the FDIC -Office of Inspector General, the Office of the Special Inspector General for the Troubled Asset Relief Program, and the Federal Bureau of Investigation. The Task Force is continuing to investigate a number of Omni-related matters.

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