Man Given Prison Term for Defrauding Banks : Courts: Former Ventura resident who swindled $7 million is sentenced to 33 months. It was county’s largest loss ever to real estate fraud.

A former Ventura man who swindled several banks and private investors out of approximately $7 million was sentenced Monday in U.S. District Court to 33 months in prison and ordered to pay more than $2.5 million in restitution.

William F. Williams, 50, who now resides in the city of Lompoc, had pleaded guilty in April, 1994, to six criminal counts, including conspiracy, making false statements on loan applications, bank fraud and money laundering.

“This was the largest loss to date involving real estate fraud in Ventura County,” said FBI Special Agent Gary Auer. “The losses sustained by Santa Paula Savings & Loan were very substantial and may well have been a significant contributing factor to the failure of Santa Paula Savings & Loan.”

In the mid-1980s, Williams defaulted on five loans totaling about $4 million from the now-defunct Santa Paula Savings & Loan. The savings and loan, suffering under the weight of this and other bad loans, was bought by the Bank of A. Levy in 1991.

Williams had also owed $1.15 million to Antelope Valley Bank in Lancaster and $950,000 to American Savings Bank of Irvine.

He had obtained the loans by inflating the income shown on his federal income tax returns from 1985 to 1988, said Assistant U.S. Atty. Peter Spivack.

Williams, a real estate developer, borrowed the money to build a condominium complex in Bakersfield, an apartment building in Fresno, a medical office building in Lancaster and a house for his personal use in Ventura, Spivack said.

Five Ventura County private investors had also contributed $132,500 to Williams for his developments, Spivack said.

After Williams defaulted on the loans, the banks foreclosed on each of the properties and sold them. After the sales, the banks and the private investors were still out about $2.5 million.

Spivack said Williams does not have the assets to repay his creditors, but the government is considering Williams’ future earnings capacity as a developer.

“He had built an empire which collapsed like a house of cards,” Spivack said.

*

The FBI in Ventura and the Internal Revenue Service criminal investigation division in Oxnard jointly investigated the case, resulting in Williams’ arrest in August, 1993.

“Real estate fraud is a crime given priority attention by the Ventura office of the FBI,” Auer said. “When, as in this case, the loss exceeds millions of dollars to institutions in Ventura County and Los Angeles County, the investigation becomes of critical significance.”

Williams’ wife, Mary Craig Williams, who lives with him in Lompoc, was charged in the original indictment but was dismissed from the case as part of a plea agreement that her husband struck with prosecutors.