D.A. Probes Mission Viejo Mortgage Firm

The Orange County district attorney’s office said Friday that it is investigating fraud complaints against the owner of a small Mission Viejo mortgage banking company who already is a defendant in a civil lawsuit accusing him of double-selling home loans.

Robert O. Potter, owner of PFG Mortgage in Mission Viejo, is under investigation in connection with an alleged scheme to defraud the Federal Home Loan Mortgage Corp. in the sale of mortgage notes, said Deputy Dist. Atty. Joseph D’Agostino.

The quasi-federal agency, better known as Freddie Mac, claims in its lawsuit that Potter defrauded it of $8.5 million by selling the agency mortgages that already had been sold to other investors.

“At this point, we are not in a position where we have enough evidence yet to charge him,” D’Agostino said.

Potter has been cooperating with investigators while maintaining his innocence, D’Agostino said.

Last month, the district attorney’s office charged Potter’s former partner, Steven Hughes, 39, and a former PFG vice president, Steven Walters, 36, with two counts each of grand theft in connection with the alleged scheme. A pretrial hearing is scheduled for Wednesday.

D’Agostino said the criminal investigation is focused on the alleged double-sale of home loans during July, 1989. The charges already filed in the case contend that the money from the alleged scheme was used to pay a $1.2-million fine owed by Potter and Hughes in a previous criminal case.

Potter and Hughes had pleaded guilty in 1989 in Ventura County Superior Court to criminal charges of grand theft and conspiracy to commit grand theft in connection with a $2.5-million loan fraud case.