BOISE (AP) — A home builder, a bank loan officer and a mortgage broker have been sentenced to federal prison for their parts in a scheme to illegally obtain construction loans worth $20 million from Zions First National Bank in southwestern Idaho.
Christopher A. Upchurch, a building contractor, was sentenced earlier this week in U.S. District Court in Boise to two years, nine months in federal prison.
U.S. District Judge William F. Downes also sentenced Upchurch to serve five years of supervised release after he completes his prison term and pay $633,634 in restitution to the bank.
In December, Upchurch pleaded guilty to illegally helping obtain 49 construction loans worth $20 million from the bank.
The scheme unraveled in 2006 when the bank discovered projects weren't being finished because money was being siphoned off.
Barbara L. Cobos, 37, formerly with Zions First National Bank in Eagle, Idaho, was sentenced to 18 months in federal prison. Prosecutors say Cobos received about $125,000 in kickbacks from Upchurch to find fraudulent loan applications. She was also ordered to serve five years of supervised release after her prison term and pay $125,000 in restitution to the bank.
Nicholas R. Gossi, 27, a mortgage broker in Boise, was sentenced to six months in federal prison, followed by six months of home detention. Gossi must also serve five years of supervised release after he completes his prison term. He pleaded guilty to submitting a false loan application to a mortgage lender.
Two others involved in the scheme who have entered guilty pleas are scheduled to be sentenced in May.
Prosecutors say shady real-estate operators like Upchurch now have added incentive to plead guilty: Those who cashed in illegally on the now-collapsed housing bubble make unsympathetic defendants.