MORTGAGE LOAN COMPLIANCE®

In California a federal jury has convicted Lila Rizk of Trabuco Canyon and Kyle Grasso, formerly of Santa Monica, of conspiracy, bank fraud and loan fraud charges for their roles in a scheme that led to more than $40 million in losses at federally insured depositories.

According to a report in The Orange County Register, Grasso, a real estate agent, also was convicted of three counts of money laundering. The duo were part of a scheme that obtained inflated mortgage loans on luxury houses, with Grasso earning commissions and other payments and Rizk, an appraiser, earning fees.

Donald Marks, an attorney for Rizk with Marks & Brooklier in Century City, said, "We are very disappointed in the jury verdict. We think our case was very defensible. We think we raised reasonable doubt, and we think she is not guilty. We will continue fighting on her behalf."

Mr. Marks said he would appeal the verdict. Eight others involved previously pleaded guilty.

On the East Coast a former Florida appeals court judge who pleaded guilty to defrauding a bank that loaned him money to purchase a residence in Hawaii is awaiting assignment of a sentencing date.

According to A. Brian Albritton, U.S. attorney for the Middle District of Florida, Thomas E. Stringer of Tampa pleaded guilty to one count of bank fraud before Magistrate Judge Mark A. Pizzo.

Stringer falsified his mortgage application for the residence by claiming that he had borrowed none of the money he was using for the down-payment, when in fact he had borrowed funds from a third party. The U.S. intends to seek forfeiture of $222,362, the amount of the proceeds from the fraud. A sentencing date has not been set.

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