News and Press Releases

Attorney Pleads Guilty to Mortgage Fraud

FOR IMMEDIATE RELEASE
May 17, 2010

NORFOLK, Va. - William D. Timberlake, 52, of Virginia Beach, Va., pled guilty today in Norfolk federal court to wire fraud in connection with a scheme to defraud commercial mortgage lenders.  Neil H. MacBride, United States Attorney for the Eastern District of Virginia, made the announcement after Timberlake entered his guilty plea before United States District Judge Jerome B. Friedman.  Timberlake will be sentenced by Judge Friedman on August 26, 2010.  He faces a maximum penalty of thirty years in prison and a fine of $1,000,000.00.

            Timberlake is an attorney who has a law office in Virginia Beach, Va.  According to court documents, between August 2005 and May 2006, Timberlake acted as a settlement agent in connection with the closing of seven residential real estate loans on local properties.  The lenders were Fremont Investment & Loan, Option One Mortgage Corporation, First National Bank of Arizona and Baltimore American Mortgage Corporation.  The settlement statements prepared and submitted by Timberlake to the lenders did not accurately reflect the receipt and disbursement of closing and loan funds.  Timberlake violated the lenders’ closing instructions by concealing agreements where the buyer would receive a portion of the seller’s proceeds and   using his own personal funds to pay closing costs on behalf of buyers.  In at least one instance, Timberlake knew that the buyer listed on the settlement statement was a straw purchaser, and a third party whose identity was concealed from the lender paid the closing costs.

            In reliance on the settlement statements, the lenders made loans totaling approximately $2,238,650.  The notes on the loans were subsequently purchased by other companies who sustained losses totaling approximately $629,000 when the loans on five of the seven properties went into default and were sold at foreclosure.  

            The case was investigated by the Federal Bureau of Investigation.  Assistant United States Attorney Alan M. Salsbury prosecuted the case for the United States.

A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.usdoj.gov/usao/vae.  Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on http://pacer.uspci.uscourts.gov.

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