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Press Release

Mastermind Of $15 Million Mortgage Fraud Scheme Sentenced To Just Over 11 Years In Prison

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

      LAS VEGAS, Nev. – The mastermind of a Las Vegas mortgage fraud scheme that caused approximately $15 million in losses to the lenders and financial institutions, has been sentenced to just over 11 years in federal prison for his guilty pleas to conspiracy and fraud charges, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

Lloyd Gardley, 60, currently in federal custody in Pahrump, Nev., was sentenced on Wednesday, Dec. 18, 2013, by U.S. District Judge Gloria M. Navarro.  Gardley pleaded guilty in August 2012 to one count of conspiracy to commit bank fraud, mail fraud and wire fraud, one count of bank fraud, and two counts of mail fraud. He will also have to serve five years of supervised release following his release from prison and pay over $1.4 million in restitution.

“Gardley is one of two individuals who were sentenced to prison this week for committing mortgage fraud in Nevada,” said U.S. Attorney Bogden.  “Unfortunately, these crimes are not victimless and the damage to the community is lasting. The mortgage fraud scheme artificially inflated home values that, in turn, raised purchase prices of comparable homes, forcing innocent homebuyers to pay well above true market value for their homes. Since 2008 when the FBI and our office made mortgage fraud prosecutions a priority, we have investigated, charged and convicted hundreds of persons for federal mortgage fraud crimes and most of them are now serving time in federal prison.”

Ten persons were charged and convicted in the scheme which occurred between 2005 and 2007 and involved the use of straw buyers and the submission of fraudulent paperwork in order to obtain mortgage loans.  Lloyd Gardley was considered to be the leader of the conspiracy and recruited others into the scheme, including loan officers, real estate agents, an escrow agent, and an accountant.  Once the mortgage loans were approved, the defendants caused money from the loan transactions to be disbursed to their own use and benefit.  The defendants typically rented the homes and re-sold them for a profit, using the same scheme.  They then defaulted on the loans, causing approximately $15 million in losses to the lenders.  The evidence showed that the defendants used the fraudulent scheme to purchase 30 homes in Las Vegas between 2005 and 2007. The total value of the mortgages was approximately $35 million.   Some of the homes were “flipped” or sold twice within short periods of time. 

The case was investigated by the U.S. Postal Inspection Service and prosecuted by Assistant U.S. Attorneys Sarah E. Griswold and Brian D. Pugh.

This case was handled in connection with the President's Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorney’s Offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit
Updated January 29, 2015