Former Fannie Mae Official Sentenced To Federal Prison For Soliciting Kickbacks From Broker Who Sold Foreclosed Properties
SANTA ANA, California – A former sales associate with the Federal National Mortgage Association (Fannie Mae) was sentenced today to 15 months in federal prison for taking kickbacks from a real estate broker who sold properties on behalf of the mortgage agency.
Armando Granillo, 45, of Huntington Beach, who worked in the Fannie Mae’s Irvine office, was sentenced by United States District Judge David O. Carter. In addition to his 15 month sentence in federal prison, Granillo was ordered to spend 6 months in a residential reentry center.
Following a two-day trial in March, Granillo was found guilty of three counts of “honest services” wire fraud for soliciting kickbacks while working for Fannie Mae.
As a “real estate owned foreclosure specialist” for Fannie Mae, Granillo reviewed applications submitted by real estate brokers who wanted to list Fannie Mae foreclosure properties, and he had the authority to approve sale offers presented by the brokers. In late 2012, Granillo asked a real estate broker in Tucson to pay a percentage of the commissions the broker earned for selling Fannie Mae foreclosure properties. The broker brought the matter to the attention of federal law enforcement officials and assisting in the investigation.
During subsequent conversations between Granillo and the broker, Granillo demanded 20 percent of the real estate broker’s commissions in exchange for preferential treatment in the assignment and sales of Fannie Mae properties. In February 2012, Granillo traveled from Orange County to the Phoenix area, where he met with the broker. During the recorded meeting, Granillo stated that the kickback arrangement was a “natural part of business.” Granillo promised to increase the broker’s portfolio and ensure that he always had at least 100 listings, to give the broker the best properties, and to help the broker get offers approved by Fannie Mae. Granillo then arranged to receive the $11,200 payment from the broker.
Granillo was arrested in this case on March 5, 2013 during an undercover operation after accepting an $11,200 payment from the real estate broker.
Granillo “violated Fannie Mae and the public’s trust by engaging in a form of public corruption,” prosecutors wrote in a sentencing brief filed with the court. “This crime is akin to those involving governmental officials who solicit bribes in exchange for favorable treatment. The reputational damage is devastating and potentially permanent.”
Fannie Mae is currently under the conservatorship of the Federal Housing Finance Agency. The investigation into Granillo was conducted by the Federal Housing Finance Agency’s Office of Inspector General.
Release No. 14-103