Former Executive of Olympia Mortgage Corp. Sentenced for Wire Fraud Conspiracy

March 20, 2009

Fannie Mae Left Holding Nearly $44 Million in Unpaid Principal in Refinanced Mortgage Loans

Benton J. Campbell, the U.S. Attorney for the Eastern District of New York, announced that Leib Pinter, 64, a former executive of Olympia Mortgage Corp., was sentenced today to 97 months in prison for orchestrating a scheme to defraud Fannie Mae in connection with mortgage loans that Fannie Mae owned, but were refinanced through Olympia.

Pinter was also ordered to pay more than $43 million in restitution to the victims of his fraud scheme. The sentencing proceeding was held before U.S. District Judge Sandra L. Townes at the U.S. Courthouse in Brooklyn, and followed Pinter's plea of guilty to a wire fraud conspiracy on Sept. 11, 2008.

Olympia, formerly headquartered in Brooklyn, originated and serviced mortgage loans owned by Fannie Mae. When Olympia refinanced a Fannie Mae mortgage loan, Fannie Mae typically wire transferred the money to an Olympia bank account. Olympia was then required to pay off the underlying mortgage loan by remitting the outstanding balance to Fannie Mae. Instead, Pinter misappropriated these proceeds for the benefit of Olympia. When the fraudulent scheme was revealed, Fannie Mae held nearly $44 million in unpaid principal in refinanced mortgage loans.

"The defendant took advantage of his relationship with Fannie Mae to enrich himself and others," said U.S. Attorney Campbell. "This case is yet another example of the Justice Department's swift and vigorous response to those who have corrupted our nation's lending practices." Mr. Campbell expressed his grateful appreciation to the FBI's New York Field Office, which led the government's investigation. In May 2008, Mr. Campbell announced the formation of a task force comprised of federal, state and local law enforcement agents and investigators to address the burgeoning problem of mortgage fraud.

The government's case was prosecuted by Assistant U.S. Attorneys Jonathan E. Green and Daniel A. Spector.