Wednesday, October 24, 2012

Johnson County man sentenced on bank fraud charges

A Johnson County man has been sentenced to 78 months in federal prison on bank fraud charges, U.S. Attorney Barry Grissom said today. He was ordered to pay approximately $2.6 million in restitution.

Paul L. Hartfield, 56, Overland Park, Kan., pleaded guilty to one count of conspiracy to commit bank fraud and money laundering.

Hartfield was indicted Nov. 4, 2010. The indictment alleged Hartfield owned two businesses in Overland Park: Hart Investments, Inc., and Diamond Mortgage, both in Overland Park. 

Hart Investments purchased depressed properties in order to rehabilitate the properties and sell them at a profit. Hartfield obtained loans to rehabilitate homes on a “subject to appraisal” basis that allowed him to withdraw money as rehabilitation progressed.

Starting in October 2006, Hartfield stopped rehabilitating houses. Instead, he and others made false representations to lenders in order to fraudulently obtain loan funds.

Co-defendant John T. Bradfield is set for sentencing Jan. 7; co-defendant Brian D. Jaimes is set for sentencing Dec. 17. Co-defendant Kevin M. Mahoney is set for sentencing Jan. 7.

Grissom commended the FBI, the Internal Revenue Service, the FDIC- Office of Inspector General, Assistant U.S. Attorney Jabari Wamble and Assistant U.S. Attorney David Smith for their work on the case.