RE Agent Gets 12+ Years for Fraud

After admitting to leading a scheme to fraudulently obtain more than $12 million in home loans, David Kostelec of Leawood, Kansas, has been sentenced to 154 months in federal prison and ordered to pay more than $1.3 million in restitution. In his plea in October 2008, Kostelec admitted that from July 20, 2002, through Oct. 14, 2005, he and others conspired to defraud lenders by submitting fraudulent loan applications and false real estate appraisals and attempted to conceal the crimes by laundering the money through accounts at various banks. Kostelec submitted false and fraudulent appraisal reports to lenders containing inflated property values and forged signatures of licensed appraisers. Conspirators stole the identities of licensed appraisers by searching the Internet for information including the appraisers' state license numbers. After closing, the conspirators used straw entities to receive the money from escrow companies. Then they moved the money to personal accounts. Kostelec admitted to committing these schemes with properties in Kansas, Missouri and Florida.