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Multi-State Mortgage Fraud Results in Hefty Sentence

In Minnesota, a former house flipper was sentenced to more than eight years in federal prison for his role in a real estate investment scheme, topping _MReport's_ weekly fraud blotter. The hefty sentence for Robert W. Dufrense, Jr., who is accused of bilking more than $5 million out of investors across multiple states, was more elaborate than expected due to an additional charge for obstructing justice.


According to ""_Twin Cities Business_"":http://www.tcbmag.com/index.aspx magazine, Dufresne was convicted of one count of mail fraud and one count of money laundering for his house-flipping scam. However, the court discovered that following his guilty plea Dufresne had attempted to obstruct justice by selling assets.

U.S. District Court Chief Judge, ""Michael J. Davis"":www.mnd.uscourts.gov, handed down Dufresne's sentence of 97 months in prison, and he also slapped the fraudster with an order to pay over $6.5 million in restitution. Thursday's sentencing comes almost a year after Dufresne pleaded guilty to the crimes in question.

Coming clean on his activities, Dufresne confessed that he fraudulently collected money from investors that was allegedly going toward the purchase, renovation, and resale of residential properties. Those investing believed that the amount earned from flipping the houses, which were spread around Minnesota and various states, would then be split among them following the sale of the real estate assets.

Dufresne went on to admit that in actuality he used the funds he accumulated for personal gain. Describing the scheme, Dufresne noted in his confession that he ran a sort of personal Ponzi scam in which he used subsequent investment dollars to pay off individuals that had previously invested.

Various government entities participated in bringing Dufresne to justice, including the ""U.S. Postal Inspection Service"":postalinspectors.uspis.gov/, the ""Federal Bureau of Investigation"":www.fbi.gov/, and the ""Internal Revenue Service's"":www.irs.gov/ criminal investigation division. The original prosecutors on the case were Assistant U.S. Attorneys Robert M. Lewis and James S. Alexander.