Laguna Niguel Broker Sentenced to 2 Years in Real Estate Fraud

LOS ANGELES-A federal judge has sentenced a Laguna Niguel real estate broker to two years in prison for his role in a complex $21-million real estate fraud.

John (Skip) Chodak, 44, previously pleaded guilty to six counts of wire fraud and one count of interstate transportation of funds obtained by fraud for his role in swindling 21 small savings and loan associations out of about $21 million.

Using false and inflated appraisals, prosecutors said Chodak and six others borrowed the money to buy two pieces of property in and near the San Fernando Valley. Instead of building anything, however, they diverted the money into a series of shell companies and pocketed the funds, according to an indictment issued in May, 1986.

In addition to the prison sentence, U.S. District Judge Harry L. Hupp on Monday also ordered Chodak to pay $120,000 in restitution to six banks he helped defraud.

“I view Mr. Chodak as one of the most culpable people in the transaction,” said Hupp, who called the scheme “a major fraudulent transaction with significant losses.”

Hupp said he intended to sentence Chodak to more than five years in prison but reduced the amount based on Chodak’s willingness to cooperate with the government.

Before the sentence was imposed, Chodak said, “I am wholeheartedly sorry for my involvement in this situation. . . . For 44 years, I’ve managed to stay on the right side of the law.”

Chodak received about $2.6 million of the $21 million fraudulently obtained from the banks, according to prosectors. He also was charged with sending about $1.1 million of the loan proceeds to a bank account in the Grand Cayman Islands in the British West Indies.

All of the money he received, except $20,000 deposited in an English bank account, is gone, according to Chodak’s probation officer. Hupp ordered the $20,000 to be returned from England immediately.

Dealing with small, out-of-state savings and loans, the defendants borrowed $14 million to purchase and develop a piece of Chatsworth property and $7 million to build a hotel in Newhall, the indictment charged.

According to the indictment, Chodak and business associate Gerald R. Ramos, 37, of the City of Orange submitted to the banks worthless financial guarantee bonds issued by Glacier General Assurance Co., a defunct Montana company owned by John F. Hayden, 66, of Santa Ana. Ramos left the country shortly before the indictment was issued but was arrested in Spain in April and is awaiting extradition.

On March 30, federal prosecutors withdrew the initial charges against Hayden but said they planned to refile them at a later date.

The case stemmed from a joint investigation by the Orange County district attorney, the state attorney general, the FBI and the U.S. attorney.