Fifth guilty plea entered in Crisp & Cole fraud case
| Thursday, Jul 01 2010 07:28 PM
Last Updated Thursday, Jul 01 2010 07:28 PM
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Christopher Stovall, left, former loan officer with Tower Lending, the mortgage lending arm of Crisp & Cole, leaves the United States Courthouse in Fresno with his attorney Carl M. Faller.
Christopher Lance Stovall, formerly a loan officer with the mortgage lending arm of Crisp, Cole & Associates, entered a guilty plea in federal court Thursday as part of a plea deal in a mortgage fraud investigation.
Stovall is the fifth person to take a deal in the case. None of them have been sentenced, however. Investigators have asked the court to delay sentencing to give the defendants time to cooperate with authorities in the ongoing investigation.
Stovall, 37, looked boyish despite his bald head and goatee as Judge Oliver Wanger asked him if he understood the terms of each point of the agreement, which was read aloud at the hearing in U.S. District Court, Eastern District of California in Fresno.
To each question, Stovall replied simply, "yes."
When the judge asked how he pleaded to four counts of felony mail fraud and aiding and abetting, Stovall said, "guilty," then shifted his weight from one foot to the other and looked down at the courtroom's blue carpet.
Stovall faces up to 30 years in prison on each count, a $1 million fine on each count and mandatory restitution, but is likely to get less than that in exchange for testifying against others in the case.
The hearing was over in just 10 minutes. Sentencing was set for Dec. 6. Stovall remains free pending his sentencing, but prosecutors requested that he surrender his passport. His attorney said he didn't have one.
Stovall declined to comment afterward.
U.S. Attorney Kirk Sherriff would say only that "we're continuing to move forward."
He declined to comment on other potential targets of the investigation.
Stovall's attorney, Carl Faller, said outside the courtroom that his client's guilty plea "obviously indicates a knowledge of the scheme that was being run by Crisp and Cole.
"One thing that's important to remember about Chris, though, is that he is one of the few who left the company voluntarily before everything came crashing down. When he got a sense of what was going on, he reached a conclusion on his own that this was not a place he wanted to be."
Faller said he had confidence that "the people who concocted the scheme are going to have their day in court. We don't want to see a situation where the only people who are punished are those who were instruments of the scheme versus those who devised it."
The FBI raided the offices of Crisp & Cole in September 2007.
The two principals of that firm, David Crisp and Carl Cole, lost their real estate licenses in 2008. Since then, three of Crisp's in-laws -- Kevin and Leslie Sluga and Megan Balod -- as well as former employee Jerald Teixeira, have accepted plea deals for fraud and aiding and abetting.
Federal prosecutors have not filed criminal charges against Crisp or Cole, but both face civil litigation from lenders.
At least 88 foreclosed properties are linked to former Crisp & Cole agency employees, family members and associates.
Authorities said Stovall, who worked for Tower Lending, was part of a mortgage loan operation that knowingly submitted applications for loans that contained false information about borrower income, assets, employment history and the intended use for the property.
Loans on two homes Stovall worked on later defaulted, costing lenders nearly $2.5 million.
