‘Far-Reaching’ Scam to Obtain $13 Million : Couple Plead Guilty in Loan-Fraud Case

A Newport Beach couple pleaded guilty Wednesday to federal charges that they used false financial statements to fraudulently obtain at least $13 million in loans from a California thrift to acquire apartment buildings.

The couple, Robert A. Buceta and his wife, Patricia L. Thibault Buceta, entered the pleas before U.S. District Judge Richard A. Gadbois Jr. in Los Angeles.

At the time the Bucetas were charged, federal prosecutors called the case “one of the largest and most far-reaching schemes ever perpetrated in Southern California.”

A federal grand jury in March, 1988, indicted Buceta and his wife each on 22 counts of conspiracy, making false statements, and mail and wire fraud. The allegations involved more than 1,000 loans totaling more than $70 million made in 1983 and 1984.

On Wednesday, Buceta pleaded guilty to five counts of making false statements on documents filed with State Savings of Stockton to support applications for loans totaling more than $13 million.

Patricia Buceta pleaded guilty to two counts of making false statements. She also entered a so-called “Alford plea”--in which she admitted there is a factual basis for the charges but did not admit guilt--to two other counts in connection with the same loans.

Possible Sentences

With the pleas, Robert Buceta faces up to two years in prison and a maximum fine of $25,000. His wife could be sentenced to two years in prison and be fined up to $20,000. In addition, both could also be ordered to make restitution, repaying the lenders they were accused of defrauding.

They are scheduled to be sentenced Nov. 20 by Judge Gadbois.

Federal prosecutors said the Bucetas engaged in a complex fraud scheme to obtain loans, with little or no collateral, from financial institutions.

Buceta engineered double escrows to purchase apartment properties for conversion to condominiums. He would obtain commitments from a mortgage broker to purchase the property at market value, complete the purchase through a straw party and at the same time sell the property to himself at a much higher price.

The financial institutions provided loans for the second, higher-priced purchase, unaware that the double sale had artificially and fraudulently inflated the prices.

The scheme allowed the couple to buy 10 apartment buildings in Southern California and other states without down payments. Both he and his wife submitted fake financial statements and tax returns to justify the higher prices, according to court documents.

The funds were supposed to be used to buy apartment buildings in at least four states for conversion to condominiums, but little work was done and the loans quickly went into default.

The loans obtained in 1983 and 1984 were made by State Savings of Stockton, now American Savings Bank; the defunct Sun Savings & Loan in San Diego; State Savings & Loan Assn., which went into receivership in Salt Lake City, and the defunct Sko-Fed Mortgage Corp. of Newport Beach.

Assistant U.S. Atty. Carolyn Kubota said the government intends “to ask for substantial sentences for both of them.”

Bucetas’ Innocence Maintained

Defense lawyers for the couple, meanwhile, continued to maintain that the Bucetas did not intend to defraud anybody. The plea was made to avoid a lengthy trial and because “a jury could reasonably find” that Robert Buceta was guilty, said Howard Weitzman, the Los Angeles lawyer who represents him.

The Bucetas still face a massive civil case in federal court in Los Angeles by the four defrauded lenders.