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7th Circuit Halts Fraud Restitution, Urges Fine For ‘Reckless’ Bank of America

first_img 7th Circuit Halts Fraud Restitution, Urges Fine For ‘Reckless’ Bank of AmericaDave Stafford for www.theindianalawyer.comThree defendants convicted of wire fraud in the purchase of 16 properties in Gary were clearly guilty of the crimes, but the 7th Circuit Court of Appeals Friday threw out a restitution order against them and urged the district court in Hammond to consider fining Bank of America for “facilitating a massive fraud.”“The bank was reckless,” Judge Richard Posner wrote in United States of America v. Minas Litos and Adrian and Daniela Tartareanu, 16-1384, -1385, 2248, 2249, 2330. The defendants were convicted of wire fraud, and the 7th Circuit affirmed those convictions, but reversed an order that they pay the bank restitution of $893,015, the amount it claimed was lost in the scheme.The defendants were convicted on wire fraud charges filed in 2012 for a scheme in which home buyers were provided down payment kickbacks from the defendants after mortgages were secured on loan applications that provided false information. The defendants then walked away with the purchase price of the properties. But the 7th Circuit wrote Bank of America didn’t have clean hands, and there was little evidence that the bank would not have made the loans had it know the true source of the down payments — the defendants, not the buyers.Posner detailed the bank’s dubious mortgage-lending history during the real-estate bubble leading up to the Great Recession, noting for instance one woman to whom the bank issued six mortgages in a 10-day period. Posner noted that District Judge Philip Simon said during sentencing in this case, “Bank of America knew [what] was going on. They’re playing this dance and papering it. Everybody knows it is a sham because no one is assuming any risk. So what’s wrong with saying they’re [of] equal culpability?”“Indeed,” Posner continued, “and we are puzzled that after saying this the judge awarded Bank of America restitution — and in the exact amount that the government had sought.”“Restitution for a reckless bank? A dubious remedy indeed — which is not to say that the defendants should be allowed to retain the $893,015.” That is stolen money,” he wrote. “We don’t understand why the district judge, given his skepticism concerning the entitlement of Bank of America to an award for its facilitating a massive fraud, did not levy on the defendants a fine of not more than the greater of twice the gross gain or the gross loss caused by an offense from which any of  $893,015. 18  U.S.C. § 3571(d) authorizes a fine of not more than the greater of twice the gross gain or the gross loss caused by an offense from which any person either derives pecuniary gain or suffers pecuniary loss.”The 7th Circuit vacated the restitution order as to the Tartareanus and remanded for full resentencing with the alternative remedy of a heavy fine on the defendants. The panel remanded Litos’ sentencing for the limited purpose of reconsideration of the restitution order with direction to consider whether a fine is possible.FacebookTwitterCopy LinkEmailSharelast_img read more

FIFA set for the first stadium inspection in Russia

first_imgA joint delegation made up of FIFA and Russia 2018 LOC representatives will hold its first official inspection visit to the 2018 FIFA World Cup™ stadiums on 16-23 October.The trip will see the delegation visiting stadia in St. Petersburg, Kazan, Sochi and Moscow, in addition to going over the projects and plans in place for the construction of the remaining 2018 FIFA World Cup venues.The joint delegation includes 40 experts from FIFA, LOC, and Arena-2018 in the areas of designing and building stadia, preparing and operating competitions, security, transport, logistics, hospitality services, broadcasting, media operations, medical control, staff performance, and marketing and ticketing programs.“Running the first joint inspection of the 2018 FIFA World Cup stadia is a crucial milestone marking the transition from the design phase to operational stage of preparations for the tournament,” noted Alexey Sorokin, CEO of the Russia 2018 LOC.“The primary goal for inspection at this stage is to receive first-hand information on how design and construction is going for the 2018 FIFA World Cup stadia. That will enable FIFA, the LOC and Arena-2018 experts to report back to representatives of the host cities with their own comments on how to optimize the work going on so as to meet all FIFA requirements.”last_img read more