Industry News

Mortgage brokers plead guilty to bribery

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A St. Louis mortgage agent and two mortgage brokers from California pleaded guilty to bribery charges relating to a bank scheme they participated in, federal officials said. Derek Fenton, 30, of Wentzville, Mo.; Richard Mehlinger, 44, of Los Angeles; and Terry Gale, 42, of Los Angeles, each pleaded guilty to one felony count of bribery in connection with bank transactions, according to a U.S. Attorney's office statement. Each defendant now faces up to 30 years in prison, up to $1 million in fines, and mandatory restitution, officials said. According to the facts filed with the court, between November 2002 and June 2004, Fenton was employed by CitiMortgage in O'Fallon, Mo., and was the primary contact at the company for several mortgage brokers located throughout the United States. In a typical scheme, Fenton would allow these brokers to backdate their loan commitments so that the brokers' clients would receive more favorable terms from CitiMortgage. In exchange for the more fav...