Irvine Broker Charged in Fraud, Racketeering Case
An Irvine mortgage broker, already facing federal extortion charges for threatening a creditor, was arraigned Monday on mail fraud and racketeering charges stemming from the alleged issuance of about $15-million worth of phony mortgage bonds.
On Monday, John Fred Parrish, 54, was charged with defrauding Alhambra-based Progressive Savings & Loan Assn. out of $5.7 million in connection with an investment package on what turned out to be 40 acres of unbuildable property in Laguna Beach.
Marc Geller, Parrish’s attorney, said Parrish plans to plead guilty to the fraud and racketeering charges at a hearing scheduled for Jan. 9.
Geller said Parrish is still living and working in Orange County but declined to elaborate.
Parrish was president and chairman of the board of Barclays Mortgage Corp., which has no connection to London-based Barclays Bank. Barclays Mortgage filed for bankruptcy protection in March.
In February, Parrish was indicted on extortion charges in connection with hiring a man to threaten a Laguna Niguel businessman who owed Parrish $500,000.
Parrish previously pleaded guilty to that charge and is awaiting sentencing, according to Assistant U.S. Atty. Terree Bowers.
On Monday, Parrish was charged with masterminding two separate schemes. One involved $9.4 million worth of mortgage bonds sold to develop “Canyon Acres Ltd.” in Laguna Beach. Barclays allegedly offered investors one-year promissory notes, with interest payable quarterly as part of the package. Parrish also offered to guarantee the payment of principal and interest and said investors would receive first and second deeds of trust for the property, according to documents filed in federal court.
But after Parrish collected the money, he defaulted on all the notes and guarantees, the complaint charged. Investors and lending institutions also found that the land was “situated on a steep hill with unstable, rugged and rocky soil,” the complaint added.
Jane M. Osborne, an attorney representing Progressive S&L;, declined to comment on the criminal charges because she had not yet read the complaint.
Parrish also faces mail fraud charges in connection with a $25-million mortgage bond offering, in which he ended up collecting about $15 million, according to Assistant U.S. Atty. Bowers.
Among the investors were two pension funds, the Motion Picture Industry Pension Plan, which invested $5 million, and the U.S. Administrators Retirement Plan.
