The Fredericton Provincial Court has now sentenced a New Brunswick mortgage broker to three years in prison for mortgage fraud.
“A five-month RCMP investigation into the operations of William Priest-Phillips of Nackawic, and his company Priest Phillips Management, which operated under the name DLC Priest Financial, has uncovered at least eight mortgage applications with Scotiabank containing falsified documents,” said Cst. Andrea Grasman of the RCMP’s Commercial Crime Section. DLC severed ties with the company on April 19, 2012, soon after it learned of the allegations against Priest-Phillips.
"Dominion Lending Centres Inc and all of its independently owned and operated franchises across Canada wish to state that William Priest has no association direct or indirect with Dominion Lending Centres," reads part of a DLC statement provided MortgageBrokerNews.ca. "Dominion Lending Centres severed all ties with William Priest and company once we were notified of the allegations against him and the impending investigations against him and his companies. Dominion Lending Centres officially terminated William Priest on April 19, 2012."
Both Priest-Phillips and his company were charged with one count each of fraud over $5,000 and one count of uttering forged documents for submitting mortgage applications containing falsified documents. Phillips pleaded guilty to the charges.
The charges against Priest-Phillips's company were dropped, but the 49-year-old mortgage broker is currently in jail serving his sentence, Grasman told MonrtgageBrokerNews.ca.
The RCMP was alerted of Priest-Phillips's activities by the New Brunswick Securities Commission, said the officer, confirming the commission had been investigating the broker for an alleged Ponzi scheme bilking families and close friends out of nearly $600,000, in mostly retirement savings.
“The securities commission basically tipped us on his activities,” said Grasman. “We found that from January to November of 2011, Priest-Phillips had submitted eight mortgage applications with falsified information to Scotiabank.”
The case may have negative consequences for the industry as a whole, as it grapples with any negative media attention in and outside the Atlantic provinces.
“Mortgage fraud negatively affects the real estate market,” said Insp. Lise Roussell of the NB RCMP’s Commercial Crime Section. “This is a serious crime as it attacks our economic integrity by placing the interest of both consumers and financial institutions at risk.”
Most broker networks, including DLC, have a zero-tolerance policy.
"DLC actively cooperates and supports the efforts of our regulators, policymakers and government enforcement agencies, will act swiftly to terminate all offending parties and supports maximum penaltie," reads the official statement provide MortgageBrokerNews.ca Monday.