A real estate developer and real estate agent in Florida each face up to 30 years in prison and fines of up to $1 million on charges related to false loan statements and income tax returns.
James Sharpe Sr., James Sharpe Jr. and Shannon Sharpe Carr last week pled guilty to making materially false statements to financial institutions in the Destin, Fla., area, U.S. Attorney Gregory Miller said Monday. Defendants will be ordered to pay restitution to all victims still owed money, and forfeit money obtained as profit for their illicit activity.
Sharpe Sr. operated several companies related to the real estate development business, all of which operated from his JAS Realty office in Destin. Carr was a full-time contract employee at JAS Realty and Sharpe Jr., a real estate licensee, earned commissions for sales through the realty office.
Sharpe Sr., his business entities and partnerships attempted to borrow, or were legally bound as guarantor for loans totaling more than $67 million for business-related purposes and $2.9 million for personal purposes. Carr obtained about $653,150 in personal loans and Sharpe Jr. obtained about $180,418 in commercial loans and $817,897 in personal loans.
From 1996 through late 2003, Sharpe Sr. was involved in the development of various projects, including Emerald Lakes, a housing subdivision located in Destin and Bella Vita, a condominium project in Walton County, Fla. Carr managed the office and kept the companies’ records and Sharpe Jr. worked as a real estate agent for the projects and sold properties on behalf of JAS Realty.
The defendants and their respective companies experienced severe financial difficulties beginning in 1998, according to the U.S. Attorney’s office. Each defendant obtained a series of business and personal loans from numerous financial institutions and individuals. Each significantly overstated their assets and income in order to qualify for the loans.
In addition, Sharpe Sr. and Carr solicited false and fictitious tax returns to obtain loans. Their tax preparer James Wilder, also convicted for his role in the scheme, in each of the tax years 1998-2001 created a false return reflecting substantially greater income than what appeared on the actual tax returns filed with the IRS.
From 1998 through mid 2003, defendants failed to pay many of the loans on time. A lot became delinquent or renewed due to lack of ability to pay. Several financial institutions and individual investors resorted to legal action or threat of legal action to recover funds.
Throughout this period, the defendants sometimes used the loan proceeds for personal use and to make payments on previous loans.
Sentencing for all three defendants is set for May 27.
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