Real Estate Fraud Operator Sentenced

The mastermind behind a $15-million real estate loan and kickback scheme was sentenced Monday in federal court to eight years in prison and ordered to repay $250,000 to at least one of the financial institutions he defrauded.

Peter Sampson, who pleaded guilty Feb. 8 to conspiracy and tax evasion, was ordered by U.S. District Judge Edward Rafeedie to spend another five years on probation for his role in the scheme, which involved about a dozen Southern California residential properties.

Prosecutors called the scheme an “expanded and sophisticated” pyramid, in which Sampson and his co-conspirators inflated the purchase price of the real estate, then obtained loans based on that price.

In a sham exchange called “double escrow,” Sampson arranged for the properties to be purchased at a real market price by one buyer, and simultaneously resold at a much higher, phony price to a co-conspirator, prosecutors said.

“I’m wrong as wrong can be, as guilty as guilty can be, as sorry as sorry can be,” a weeping Sampson told Rafeedie. Sampson’s recruits included top-level savings and loan officials, Beverly Hills lawyers and escrow officers.

The lawyers functioned as “straw buyers” who used their good credit ratings to qualify for loans that Sampson knew he could not obtain, prosecutors said. These supposed buyers then allowed the loans to default.

The escrow officers prepared fictitious receipts for funds that were never deposited, and sent falsified loan documents to the lending institutions.

Progressive Savings & Loan Assn. of Alhambra and at least one other lender were “stuck holding the bag, but the bag was empty,” Assistant U.S. Atty. Alice Hill said. The institutions lost a total of at least $4.6 million, Hill said.

Sampson is the last of 11 defendants to be sentenced. The others received penalties ranging from probation to three years in prison.