Real Estate Broker Pleads Guilty To Scheme To Defraud Clients
Debbie Foust, 60, of Mt. Juliet, Tennessee, a real estate broker and former owner of Century 21 Music City, pleaded guilty yesterday in U.S. District Court, to one count of wire fraud, announced David Rivera, Acting U.S. Attorney for the Middle District of Tennessee. The charge arises from Foust’s scheme to defraud her clients of funds provided as a down payment for a purchase of commercial real estate.
“Real estate brokers are entrusted by citizens and investors to maintain client funds for their intended purpose, not to be used improperly for personal gain,” said Acting U.S. Attorney David Rivera. “The U.S. Attorney’s Office will continue to seek out and prosecute professionals who defraud their clients or betray their positions of trust.”
At the plea hearing, Foust admitted obtaining a $200,000 deposit via interstate wires from clients who sought to purchase a parcel of commercial real estate located in Madison, Tennessee. Contrary to her representations to these clients, Foust did not keep these funds in trust for use as a down payment on the commercial parcel but instead, converted the funds to her own use by writing checks totaling $170,000 to other accounts controlled by her. Foust further admitted writing a check to the sellers of the commercial parcel that was returned for insufficient funds, and failing to appear at the closing for the sale of the property, which was never consummated.
After accepting Foust’s plea, U.S. District Judge William J. Haynes, Jr. scheduled a sentencing hearing for September 12, 2013. Foust faces a maximum sentence of 20 years in prison and a maximum fine of up to $250,000.
The case was investigated by the FBI. The case is being prosecuted by Assistant U.S. Attorney William F. Abely.