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Case Number: 1:19-cr-00034-ELH
Judge: Ellen L. Holland
Court: United States District Court for the District of Maryland (Baltimore County)
Plaintiff's Attorney: Matthew J. Maddox
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Description: Baltimore, MD - The United States of America charged John O'Day with:
John O’Day, age 48, of Chester and Stevensville, Maryland, and Sarasota, Florida, was sentenced to 104 months in federal prison, followed by five years of supervised release, for federal charges of bank fraud and aggravated identity theft, in connection with a scheme to defraud at least 20 individuals and five financial institutions of more than $1 million by submitting fraudulent auto loan applications. Judge Hollander also ordered O’Day to pay restitution of $1,072,091, with interest.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Rodney A. Davis of the Treasury Inspector General for Tax Administration; Chief Marcus Jones of the Montgomery County Police Department; and Colonel William M. Pallozzi, Superintendent of the Maryland State Police.
According to his plea agreement, between April 2016 and January 2018, O’Day and his co-conspirators, Denise White and Nigel Broomes, submitted at least 30 fraudulent applications for auto loans to victim financial institutions falsely listing O’Day as the seller of various motor vehicles, which were listed as collateral, but in which neither O’Day or the listed purchaser had any ownership interest. At least 27 of the fraudulent applications were successful and resulted in the disbursement of loan checks totaling approximately $1,167,192. O’Day deposited those funds into his personal bank accounts in Maryland. O’Day provided a portion of the fraud proceeds to his co-conspirators. The funds were not used to purchase vehicles. O’Day attempted to obtain additional loan checks totaling at least $246,000 through several unsuccessful auto loan applications.
Most of the applicants listed in the auto loan applications were recruited by O’Day under false promises and pretenses. Specifically, O’Day falsely promised that he would pay off the auto loans within up to 90 days and that the borrowers would not be responsible for loan payments. O’Day made payments in smaller amounts to most of the borrowers to assist them temporarily in making periodic payments on the loans and to compensate them for their involvement in the scheme. However, O’Day eventually stopped assisting borrowers with their payments and failed to pay off the loans as he promised. Most of the borrowers remained liable for the loans and suffered financial hardship as a result. At least some of the fraudulent auto loans were eventually converted to unsecured personal loans with higher interest rates as a result of the applicants’ failure to produce proof that they had purchased the vehicles. Several of the applicants had no knowledge that O’Day and his co-conspirators had submitted applications in their names and never authorized them to do so.
O’Day, White, and Broomes used the personal identification information of at least five individuals, without their knowledge or approval, to submit fraudulent loan applications. At least two of the applications were approved and resulted in the disbursement of loan checks totaling $98,000.
O’Day admitted that he also laundered the proceeds of the fraudulent auto loan scheme through the purchase of a home. O’Day worked as a loan officer with a mortgage brokerage company located in Maryland between January 2014 and August 2017. Between January and March 2017, O’Day requested that his employer issue him a company check for his closing costs in return for him transferring funds to the company. O’Day deposited $90,000 in fraud proceeds into a bank account he controlled, then wired $33,750 from that account to his employer’s account. The following day, the employer wired $33,750 to another of O’Day’s accounts and O’Day purchased a cashier’s check in the amount of $30,000 drawn on that account, which he used to pay the closing costs associated with the purchase of his home.
According to their plea agreements, White and Broomes personally submitted some of the fraudulent auto loan applications. White also contacted the financial institutions under false pretenses in order to get the applications approved. White used multiple e-mail accounts in which she received correspondence from the various financial institutions to which she submitted fraudulent loan applications. Upon O’Day’s request, White also contacted borrowers whom O’Day had recruited in order to assuage their concerns about their involvement with the auto loans, requests made by the financial institutions for proof of ownership of the vehicles, and O’Day’s failure to pay off the loans taken out in their names, falsely identifying herself as “Lisa.” White and Broomes also fabricated documents in support of the fraudulent loan applications and O’Day’s efforts to negotiate the loan checks.
Denise White, age 32, of East Point, Georgia, and Nigel Broomes, age 39, of Atlanta, Georgia previously pleaded guilty to their roles in the scheme. White and Broomes each face a maximum of 30 years in federal prison for bank fraud, and White also faces a mandatory minimum sentence of two years in federal prison, consecutive to any other sentence imposed, for aggravated identity theft. Judge Hollander has scheduled sentencing for White and Broomes on November 15, 2019, at 10:00 a.m. and 11:00 a.m., respectively.
United States Attorney Robert K. Hur commended TIGTA, the Montgomery County Police Department, and the Maryland State Police for their work in the investigation.
18:1344 BANK FRAUD; 18:2 AIDING AND ABETTING
18:1028A(a)(1) and (c)(5) AGGRAVATED IDENTITY THEFT; 18:2 AIDING AND ABETTING
Outcome: IMPRISONMENT for a term of 80 months as to count 13s and 24 months as to count 14s, to run consecutive, for a total term of 104 months, with credit for time served from February 5, 2019 to September 24, 2019. Defendant shall serve this sentence concurrent with the Maryland State sentences he is currently serving (Queen Anne's Co. Case 17K16010184, C17CR17000638, C-17-CR-19-00386); SUPERVISED RELEASE for a term of 5 years as to count 13s and 1 year as to count 14s to run concurrent for a total term of 5 years; Total ASSESSMENT $200.00; RESTITUTION $1,072,091.99