A former Cape Coral police sergeant has received three years probation in federal count for his participation in a $4.2 million mortgage fraud scheme.
U.S. District Judge John E. Steele sentenced James J. O’Brien, 37, to the probation, plus $468,750 in restitution and 180 days on detention, Monday. O’Brien had pleaded guilty to one count of loan and credit application fraud.
The charge carried a maximum sentence of 30 years in federal prison.
“As for his sentence, we know that he had a severe medical situation, so obviously that was taken into account,” Steve Cole, the spokesman for the U.S. Attorney’s Office, Middle District of Florida, said Tuesday.
Cole would not comment further on the case.
O’Brien participated in the “cash-out” mortgage fraud conspiracy with a group of individuals that included Stephen Petrovich, 35, a former detective with the CCPD and the son of former Cape Coral Police Chief Rob Petrovich. The scheme took place from 2007-08 and involved eight Cape properties.
The group reported “inflated sales prices to lenders and falsified applications for loans based on the higher prices, then pocketed the excess loan proceeds at closing,” according to court documents. O’Brien pocketed about $95,000, which he used to refinance his residence, pay bills and loans, and buy a car.
Attorney Peter D. Aiken, of Fort Myers, represented O’Brien. Aiken was unavailable for comment Tuesday, according to his office staff.
Assistant U.S. Attorney Nicole Waid prosecuted the case.
O’Brien submitted his voluntarily resignation with the CCPD in May. Hired in August 1999, his annual salary was $71,448. Prior to resigning, O’Brien had been on administrative duty pending an outcome in the federal investigation.
O’Brien is the last defendant connected to the case to be sentenced.
Stephen Petrovich of Cape Coral was sentenced July 6 to 24 months for one count of conspiracy to commit bank fraud and wire fraud and 24 months for one count of money laundering by U.S. District Judge Charlene Honeywell. The sentences will run concurrently, according to the U.S. Clerk’s Office.
The charges of one count of conspiracy to commit bank fraud and wire fraud and one count of money laundering carried a maximum sentence of 30 years.
Tyler Forrey, 28, of Cape Coral, was sentenced July 26 on the same two counts. He received 18 months for each count, to be served concurrently. Honeywell handed down the same sentence on the same two counts to Troy Bossert, 32, of San Antonio, Texas, on July 19. They also run concurrently.
On June 21, Honeywell sentenced Steven Reese, 32, of Cape Coral to the same 18 months each for the two counts, to be served concurrently. Ryan O’Brien, 34, also of Cape Coral, received 15 months each for the same two counts on June 28. Again, Ryan O’Brien’s sentences will run concurrently.