Oregon Man Pleads Guilty to $3.7M Fraud Scheme

Lee Howlett of Portland, Oregon, pleaded guilty before U.S. District Court Judge Robert E. Jones to charges related to his participation in a mortgage fraud scheme. Howlett was charged as part of Operation Malicious Mortgage, a nationwide mortgage-fraud sweep involving more than 400 defendants. According to Karin J. Immergut, U.S. attorney for the District of Oregon, between 2002 and 2006, Howlett conspired with others to purchase real property in the name of co-conspirators. He caused false information to be given to mortgage lenders in applications for mortgage loans by the co-conspirators to induce lenders to approve mortgage loans. He created false appraisal reports for properties used in the conspiracy and signed the reports using the name and license number of a licensed appraiser without the appraiser's knowledge or authority. Appraisals on some properties were inflated and the higher value was used to apply for larger loans. According to court records, between 2003 and 2006, Howlett made false statements on applications for mortgages on approximately 16 transactions involving seven properties and financing totaling around $3.7 million. Howlett took the excess funds for his own use and to share with his co-conspirators. The properties were either sold or went into default. Sentencing is set for May 5, 2009.