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Press Release

Real Estate Developer And Escrow Agent Sentenced To Prison For Mortgage Fraud

For Immediate Release
U.S. Attorney's Office, District of Arizona

            TUCSON, Ariz. – On Aug. 9, 2013, Walter Scott Fruit, 54 and Sandra Jackson, 48, both from Tucson, Ariz., were sentenced to federal prison by U.S. District Court Judge Cindy K. Jorgenson for their role in a mortgage fraud scheme.  Fruit was sentenced to 30 months in prison; Jackson was sentenced to six months in prison.  Fruit had previously pleaded guilty on Feb. 28, 2013, to charges of conspiracy to commit bank fraud and conspiracy to commit transactional money laundering, both felonies. Jackson had previously pleaded guilty on Feb. 27, 2013, to conspiracy to commit wire fraud, also a felony.   

            As part of his guilty plea, Fruit, a real estate agent and real estate developer, admitted his participation in a mortgage fraud scheme to obtain various loans between July 2006 and May 2007.  Fruit and another co-conspirator, also a real estate developer, purchased several properties using various business entities with which they were associated.  Thereafter, Fruit and his co-conspirator sold these properties to straw buyers.  Fruit also admitted that he fraudulently inflated the true sales price of the properties. 

As part of the loan approval process, Fruit knowingly caused to be submitted documents containing false statements representing that the borrowers would provide the down payment or cash to close the real estate transactions.  Portions of the fraudulently obtained loan proceeds were wired or deposited into bank accounts controlled by Fruit or another co-conspirator.   

Jackson, a former escrow agent, admitted as part of her guilty plea that she obtained three properties through fraudulently obtained loans and that she knew that documents provided to the lenders on her behalf relating to these properties contained one or more material false representations. 

The properties obtained as result of this mortgage fraud scheme went into foreclosure resulting in significant losses to the lenders.  As part of Fruit’s sentence, he was ordered to pay a restitution judgment totaling more than $2.5 million dollars.  Jackson was ordered to pay approximately $480,000. 

            The investigation in this case was conducted by the Internal Revenue Service, Criminal Investigation and the Federal Bureau of Investigation. The prosecution was handled by Jonathan B. Granoff, Assistant U.S. Attorney, District of Arizona, Tucson.

CASE NUMBER:                  CR-11-3046-TUC-CKJ
RELEASE NUMBER:           2013-063_Fruit/Jackson

For more information on the U.S. Attorney’s Office, District of Arizona, visit

Updated January 7, 2015