Bank Exec Faces Up to 30 Years in Prison for Mortgage Scheme

A California bank executive was convicted by a federal grand jury last week on six counts of mail fraud for his part in a complex mortgage fraud scheme. Joel Blanford, 44, of San Ramon, faces up to 30 years in prison and a fine of up to $250,000, or twice the value of the gain or loss, whichever is greater.

This case is the product of an extensive investigation conducted by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation.

From approximately April 2003 through October 2005, Blanford, while working as a sales representative for Long Beach Mortgage, a wholesale subprime lender and former subsidiary of Washington Mutual Inc., participated in a scheme to defraud his employer.

Blanford earned compensation based on the volume of loans processed by Long Beach Mortgage. He was convicted of paying a loan coordinator in cash and checks to falsify documents, provide false verification of borrowers’ employment or professional licensing status, and to turn a blind eye to fraudulent representations contained in loan applications and other documents submitted to Long Beach Mortgage.

In each of the years 2003, 2004, and 2005, Blanford received, before taxes and payroll deductions, more than $1 million in commissions and other compensation from Long Beach Mortgage as a result of his scheme. Between April 2003 and October 2005, he paid the loan coordinator more than $50,000 in checks alone.

An earlier trial of Blanford resulted in a hung jury, although this federal jury didn’t seem to have the same trouble.

Not only do real estate professionals have to worry about HUD and the CFPB, but now the FBI is getting more involved – look out criminals.

  • Jamie in Santa Monica

    It’s amazing to me that this resulted in a hung jury the first time, when the man was clearly guilty. Glad he was finally convicted.

  • Robert

    Whoa, seems a little crazy to me that the FBI is getting involved in these types of cases.

    • Tired of Greasy Palms

      about time.

  • Dave

    I like that his whole team is going down. Maybe they’ll all get to share a prison cell.