News and Press Releases


THURSDAY - April 21, 2011


RALEIGH - United States Attorney George E.B. Holding announced that in federal court today a jury convicted ERIC OMAR JONES, 41, of Clinton, North Carolina. Following the six-day trial, the jury found JONES guilty on all counts of the Superseding Criminal Indictment that was returned on February 2, 2011, which included one count of conspiracy, fifteen counts of bank fraud, and two counts of false statements to an FDIC insured bank. United States District Judge James C. Dever III, presided.

The Government’s evidence showed that between 2002 and 2004, JONES participated in a scheme to defraud Omni National Bank and other banks. JONES used the credit of straw purchasers to obtain loans from Omni National bank in the name of those individuals. He then used that loan money to purchase properties through his company, University of Hard Knocks Investments, Inc. and then immediately resell them to the straw purchasers, whom he referred to as investors. Five straw purchasers testified at trial. David Pikul, the closing attorney who handled these transactions, also testified at trial. On April 11, 2011, Pikul pled guilty to conspiring with JONES to commit bank fraud and to make false statements to an FDIC insured bank. JONES enticed the straw purchasers to participate by promising them that he would make mortgage payments on the properties, take care of repairs, and sell the properties at a profit. These promises were untrue and fraudulent.

Further evidence showed that to obtain loans from Omni and other banks, JONES made numerous false statements on the HUD settlement forms that were submitted to the banks. These forms hid the fact that the bank’s money was being used by JONES’ company to purchase the property. They also often falsely stated that a down payment was being made—where there was none. Sometimes the HUD forms falsely stated the seller of the property. As part of this scheme, on at least four occasions, JONES sold the same property to the same straw purchaser a second time for a higher price. In addition, JONES was living in one of the properties he had sold to one of the straw purchasers. He was doing this without her knowledge and without paying any rent or mortgage. This straw purchaser ultimately had to evict him.

JONES testified at trial admitting he had ten years of experience in the mortgage and real estate industry at the time of the crime. He also admitted receiving and signing many of the false HUDs–knowing they were false. He claimed that the closing attorney, David Pikul, had come up with this idea and had told him that it was a correct way of doing things. He admitted receiving a lot of money through University of Hard Knocks Investments and using that money, considered by him to be his business “profits,” to take several gambling trips to Las Vegas, Atlantic City, South Carolina, and New Orleans.

Mr. Holding stated, “Individuals who commit mortgage fraud contribute to the problems in our banking system. This is a serious crime that affected not only the banks but the individuals whose credit was used.”

At sentencing, scheduled for the August 1, 2011, term of court, JONES faces up to five years’ imprisonment for the conspiracy charge and up to 30 years’ imprisonment for each of the other 17 charges.

The Federal Bureau of Investigation and the North Carolina State Bureau of Investigation participated in this investigation. David A. Bragdon and William M. Gilmore represented the United States.

News releases are available on the U. S. Attorney’s web page at

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