JOSEPH HAL KINLAW, JR. Pleads Guilty To Bank Fraud

JOSEPH HAL KINLAW, JR. Pleads Guilty To Bank Fraud

<h2 class&equals;"node-title">Bald Head Island Attorney And Real Estate Developer Pleads Guilty To Bank Fraud<&sol;h2>&NewLine;<div class&equals;"field field--name-field-pr-body field--type-text-long field--label-hidden">&NewLine;<div class&equals;"field&lowbar;&lowbar;items">&NewLine;<div class&equals;"field&lowbar;&lowbar;item even">&NewLine;<p><strong>RALEIGH<&sol;strong> – The United States Attorney’s Office announced that today in federal court&comma; <strong>JOSEPH HAL KINLAW&comma; JR&period;&comma; <&sol;strong>63&comma; of Bald Head Island&comma; North Carolina<strong>&comma; <&sol;strong>pled guilty to <strong>Bank Fraud<&sol;strong>&period;<&sol;p>&NewLine;<p>Based upon the Criminal Information and evidence offered at the time of <strong>KINLAW’s<&sol;strong> guilty plea&comma; <em>KINLAW<&sol;em> was a licensed North Carolina attorney who operated various alleged real estate investment and development entities on behalf of investors&period;  <strong>KINLAW<&sol;strong> used the entities to obtain <strong>real estate development loans<&sol;strong> from Branch Banking and Trust &lpar;BB&amp&semi;T&rpar;&comma; and First Citizens Bank&period;  BB&amp&semi;T and First Citizens Bank <em>extended loans<&sol;em> to these entities under the auspices that the entities would be engaged in the development of residential <strong>real estate<&sol;strong> in various subdivisions in the area of Camp Lejeune in Onslow County&period;<&sol;p>&NewLine;<p>Between January of 2011 and April of 2013&comma; KINLAW used the <em>real estate development entities to defraud<&sol;em> BB&amp&semi;T and First Citizens Bank by falsifying the legal descriptions of the <a class&equals;"wpil&lowbar;keyword&lowbar;link" href&equals;"https&colon;&sol;&sol;www&period;fraudswatch&period;com&sol;category&sol;loans&sol;" title&equals;"loan" data-wpil-keyword-link&equals;"linked" data-wpil-monitor-id&equals;"197">loan<&sol;a> collateral&comma; and by falsifying releases of the collateral&period;  Bydrafting a false legal description of the property&comma; KINLAW was able to use the collateral for other real estate investment activities and loans&period; By <em>fraudulently releasing the banks<&sol;em>’ collateral before the banks’ loans had been satisfied&comma; <strong>KINLAW <&sol;strong>was able&comma; in several instances&comma; to convey the collateral to third parties for value and continue the scheme&period;<&sol;p>&NewLine;<p>To perpetuate the scheme and prevent its discovery&comma;KINLAWalso used outside funds&comma; that is&comma; funds unrelated to the real estate development activity that was the subject of each loan&comma; to make ongoing loan interest payments to BB&amp&semi;T and First Citizens Bank&period;  In some instances&comma;KINLAW used loan proceeds on one transaction to make loan interest payments on another transaction&period;  In other instances&comma;KINLAW<strong> fraudulently<&sol;strong> extracted funds from other investors and their business interests to make payments on the loans&period;<&sol;p>&NewLine;<p>Ultimately&comma; banks stopped loaning money toKINLAW and his related companies and investors&period;  As a result&comma; the existing loans went into default&period;  BecauseKINLAW had substituted false legal descriptions of bank collateral&comma; and fraudulently conveyed bank collateral&comma; BB&amp&semi;T and First Citizens Bank were unable to capture their loan losses in foreclosure&period;  Various title insurance companies and investors also lost substantial funds due to the scheme&period;  While the exact amount of the loss remains the subject of investigation&comma; losses are presently anticipated to exceed &dollar;18 Million&period;<&sol;p>&NewLine;<p>At sentencing&comma;KINLAW faces up to 30 years in prison and 5 years of supervise release&period;  The defendant also faces a fine of up to &dollar;1 Million&comma; and an order of restitution to victims&period;<&sol;p>&NewLine;<p>The investigation of this case was conducted by the Federal Bureau of Investigation&comma; with assistance of the United States Postal Inspection Service&period;  Assistant United States Attorney William M&period; Gilmore of the <a href&equals;"https&colon;&sol;&sol;www&period;fraudswatch&period;com&sol;financial-scams-most-common-ways&sol;"><strong>Economic Crimes<&sol;strong><&sol;a> Section represents the United States&period;<&sol;p>&NewLine;<&sol;div>&NewLine;<p><a href&equals;"https&colon;&sol;&sol;www&period;justice&period;gov&sol;usao-ednc&sol;pr&sol;bald-head-island-attorney-and-real-estate-developer-pleads-guilty-bank-fraud">Original PressReleases &&num;8230&semi;<&sol;a><&sol;p>&NewLine;<&sol;div>&NewLine;<&sol;div>&NewLine;

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