Ex-mortgage broker’s case goes to jury
Posted on Saturday, January 26, 2008
As traffic inched by outside the federal courts building in downtown Little Rock on Friday afternoon, a jury huddled inside to begin deliberating on 16 fraud charges against Nelson Miller, former owner of a mortgage brokerage firm in Little Rock called Freedom Financial of Arkansas.
After nine days in the courtroom listening to the testimony of about 30 witnesses and arguments from attorneys, the nine women and three men indicated that they wanted to start deliberations Friday, despite rain and freezing temperatures outside.
Despite the late-morning closing of the courthouse for weather reasons, Chief U. S. District Judge Leon Holmes, who is presiding over Miller’s second trial in three months, agreed to let jurors deliberate until midafternoon and then resume their deliberations Monday.
Nelson’s first trial, held for 10 days in November, ended with another jury becoming deadlocked.
In his retrial, as in the first trial — both held during a period of national financial upheaval blamed largely on the previous years’ proliferation of subprime lending — Miller is accused of connecting borrowers with subprime lenders without always informing the lenders of the borrowers’ shaky financial situations.
Miller, 39, of Baton Rouge concedes that 15 loan applications singled out by prosecutors from among thousands processed by the company contained false information designed to make lenders more likely to fund the loans. But Miller contends that contrary to the testimony of a string of former managers who testified against him, he didn’t direct or approve — or even know about — the false applications.
He said he was distracted much of time by personal problems and put too much trust in his top managers.
Among the ways in which the managers manipulated the applications were inflating the annual income of the borrowers or creating new, clear titles through Miller’s related title company, Absolute Abstract, to remove liens on the borrowers’ homes or erase late-payment histories and credit-card debt.
Freedom Financial made its money off brokerage fees paid by the lenders. Teams of former loan officers under Miller testified that they competed fiercely against one another to generate the highest number of loans and secure hefty financial bonuses.
Several of the top managers pleaded guilty to fraud-related charges, admitting to being a part of the scam, and two of them admitted embezzling funds from Miller’s funding account. They said Miller permitted them to skim money off the account and that they did it, too — but he contends that he discovered their embezzlement only after he was charged with submitting false loan applications and began reviewing hundreds of documents while awaiting trial.
Miller, represented by Little Rock attorney Gary Corum, faces a single count of conspiracy to commit wire fraud and 15 individual charges of wire fraud.
If convicted, he faces up to 20 years in prison and fines of up to $ 1 million.
FEEDBACK:
Something to say about this topic? Submit a Letter to the Editor online
