Defendant Sentenced to 51 Months in Prison for Mortgage Fraud Scheme

PHILADELPHIA – Steven Pitchersky, 65, of Rancho Mirage, California, was sentenced today to 51 months in prison for a scheme to defraud Ally Bank that resulted in losses to the bank of approximately $5.3 million.

Pitchersky, who pleaded guilty to wire fraud on September 23, 2013, operated Nationwide Mortgage Concepts (“NMC”), a California mortgage lender.

Between August 2009 and January 2011, Ally was the warehouse lender for thousands of mortgage loans in which NMC borrowed from Ally’s warehouse line of credit to refinance first mortgages held by other financial institutions. Pitchersky made misrepresentations to Ally to secure the warehouse line of credit including his false representation that NMC had a current $10 million warehouse line of credit with a company named MPL.

Pitchersky used NMC’s $10 million warehouse line with Ally to obtain funds to refinance thousands of mortgages held by other banks for NMC customers. Ally required NMC to disburse funds through a third-party, commonly referred to as a title company. Pitchersky used a company called Hanover as the title company but, unbeknownst to Ally, Pitchersky had created Hanover.

In addition to the prison term, U.S. District Court Judge John R. Padova ordered restitution in the amount of $3,242,888, five years of supervised release and a $100 special assessment.

The case was investigated by the Federal Bureau of Investigation, the Office of the Special Inspector General for the Troubled Asset Relief Program, and the Department of Veterans Affairs Office of Inspector General. It was prosecuted by Assistant United States Attorney David L. Axelrod.

Pitchersky used the money to fund his luxurious lifestyle and extravagant art collection, according to Christy Romero, Special Inspector General for TARP (SIGTARP). “Greed got the best of Pitchersky and, for his crimes, he will spend the next 51 months in federal prison,” Romero said.

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