It’s been three years since a Voice of San Diego investigation exposed a $13 million mortgage swindle involving more than 80 condos in North County cities Escondido and San Marcos.

This afternoon, federal courts sentenced the swindle’s mastermind, James McConville, to nearly eight years in prison and ordered him to pay more than $7 million in restitution. McConville pleaded guilty in January to fraud and money laundering charges.

The swindle’s effects still linger. The crash from more than 80 foreclosures in three complexes caused surrounding condos’ value to plummet. McConville’s scam units sold in 2008 for more than $300,000 each. Today, there are units in one of the complexes, Sommerset Villas, currently for sale for $64,900 and $80,000.

When my colleague Will Carless and I worked on this story, one of the things that stood out the most was the timing. (Read Part Two of our series, “How It Could Happen in 2008.”) McConville’s fraud happened at the same time the country’s big banks and the federal government were touting their crackdown on the excesses of the housing boom that had led to a global financial collapse.

That timing showed up in the Northern California U.S. Attorney’s Office’s announcement of McConville’s sentence today. From U.S. Attorney (Melinda) Haag:


We Stand Up for You. Will You Stand Up for Us?

Mr. McConville’s actions during our country’s financial crisis caused financial institutions to lose millions of dollars. What he thought would be a big payday for him, instead resulted in an extended prison stay.

We’ve filed all of our coverage over the years of this scam on one index page; check it out here.

I’m Kelly Bennett, reporter for Voice of San Diego. You can reach me directly at kelly.bennett@voiceofsandiego.org or 619.325.0531.

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    This article relates to: A Staggering Swindle, Community, Economy, Housing, Investigations, Neighborhoods, News

    Written by Kelly Bennett

    Kelly Bennett is a freelance contributor to Voice of San Diego. You can reach her directly at kelly@vosd.org.

    4 comments
    Cliff Powell
    Cliff Powell subscriber

    Mortgage fraudsters are somewhat common. Of course not everyone is out there renting identities to steal. I think whats worse then this is the mortgage companies that are fraudsters. There are many companies that seem to be blatantly taking advantage of people. They lend more than people can afford to pay back. Before taking a mortgage out, get educated. Be willing to learn what you are signing. This is the largest investment that most Americans make. Also, do look into the company that you are planning on financing with. Check the companies reviews. If you do these things, hopefully there will be much less chance of a mortgage company taking advantage of you.

    cliffhpowell
    cliffhpowell

    Mortgage fraudsters are somewhat common. Of course not everyone is out there renting identities to steal. I think whats worse then this is the mortgage companies that are fraudsters. There are many companies that seem to be blatantly taking advantage of people. They lend more than people can afford to pay back. Before taking a mortgage out, get educated. Be willing to learn what you are signing. This is the largest investment that most Americans make. Also, do look into the company that you are planning on financing with. Check the companies reviews. If you do these things, hopefully there will be much less chance of a mortgage company taking advantage of you.

    Jon Osborn
    Jon Osborn subscriber

    Eight years is a pretty stiff sentence for white collar crime. But just imagine if he had robbed a bank of $10,000. He'd get, what, 25 years? And if he himself were black AND had robbed a bank, he'd probably get life.

    Jon Osborn
    Jon Osborn

    Eight years is a pretty stiff sentence for white collar crime. But just imagine if he had robbed a bank of $10,000. He'd get, what, 25 years? And if he himself were black AND had robbed a bank, he'd probably get life.