This is one of those stories that you don’t hear a lot about, simply because it doesn’t happen too often. A former mortgage broker in New Brunswick has been charged with forging documents and is now serving a three-year sentence after pleading guilty in court late last week. The case showcases how sometimes, it’s not only home buyers that are desperate to get those mortgages, but sometimes brokers too.
William Priest-Phillips pled guilty to one count of fraud over $5,000 and one count of uttering forged documents. This was when Priest-Phillips was still operating as a mortgage broker in New Brunswick. It’s hard to say how long the scheme was going on for. Priest-Phillips pled guilty in court right away, so the details of the case were not divulged. It is known that he submitted many documents to Scotiabank that contained falsified information so that he could get his clients more approvals on their mortgages. He’s now been sentenced to three years after owning up to the charges in court.
But while this may be a story that holds the interest for those in the mortgage industry, and certainly home buyers, it’s a story that some in the media would have you think happens all the time. In fact, it doesn’t. Lenders and mortgage brokers alike are aware of the disastrous effects forging mortgage documents are. It could lead to default because a person has been approved for a loan they can’t afford; not to mention the risk to the broker’s or lender’s own personal freedom, as we see in the case of Priest-Phillips. And of course, there’s also the fact that the vast majority of lenders and brokers are just honest people.
That wasn’t the case with Priest-Phillips, and this mortgage forgery wasn’t his only offence, either.
In addition to being a mortgage broker, Priest-Phillips was also an investment broker. And it was with his clients’ investments that he really did the most damage.
Priest-Phillips was thought to be in a Ponzi scheme. He was found guilty of defrauding nine investors of almost $600,000 in retirement money and life insurance. This is money that of course, his clients never saw returned. Priest-Phillips would entice his clients to use that money to invest in real estate. Real estate that probably was never even there to invest in.
“I lost all my life savings,” said Susan Fox, one of the nine victims in the case. “My husband was killed and he left me life insurance that is gone. I hoped to retire this year, now I don’t know when I will be able to.” Fox lost $145,000 to Priest-Phillips.
Bev Hawkes, another victim, turned over her $130,000 of her family inheritance to the broker, hoping to make a nice return.
“All of a sudden I just couldn’t get the money,” says Hawkes. “Every time I tracked him down, ‘Well, my mother just had a heart attack’ then all of a sudden it was his mother-in-law that had the heart attack. It was just excuse after excuse.”
What do you think of this case? Is three years enough for someone who stole that amount of money from so many people? Let us know using the comment section or like us on Facebook and get in on all the financial and real estate talk! And, make sure you come back tomorrow when we’ll look at several different ways you can protect yourself from this type of mortgage fraud.