FOR IMMEDIATE RELEASE
March 3, 2006
ID THEFT RING LEADER GERALD SMALL SENTENCED IN MULTI-MILLION DOLLAR MORTGAGE FRAUD SCHEME
DENVER – Bill Leone, United States Attorney for the District of Colorado, Terry L. Stuart, Special Agent in Charge of the IRS-Criminal Investigation, Denver Field Office, and Richard C. Powers, Special Agent in Charge of the Federal Bureau of Investigation’s Denver Office, announced that GERALD P. SMALL, III, age 43, of Broomfield, Colorado, was sentenced today by Chief U.S. District Court Judge Lewis T. Babcock to serve 101 months in federal prison. SMALL will also have to pay over $37,000,000 in restitution. The court deferred entry of judgement and restitution for 10 days so that disputed issues in the related forfeiture proceeding may be resolved. Chief Judge Babcock ordered SMALL to surrender to a facility to be later designated by the Bureau of Prisons.
SMALL was arrested on a Criminal Complaint on March 12, 2004. On April 6, 2004, a grand jury in Denver indicted SMALL and five others for implementing a scheme to obtain hundreds of millions of dollars in bogus mortgages and multi-million dollar lines of credit by falsifying documents submitted through SMALL’s company, Amerifunding, located in Westminster, and another Denver company controlled by SMALL, 20th Century Mortgage, Inc.
According to the facts stipulated in the plea agreement, SMALL and his associates at Amerifunding used help-wanted advertisements published in a Denver newspaper to solicit job applicants, promising salaries of more than $100,000, for the sole purpose of obtaining the applicants’ personal identification information to obtain the fraudulent mortgage loans.
Others previously charged and convicted in the same indictment as GERALD SMALL were: KELLI SMALL, who was sentenced to serve 160 hours of community service during her 5 years probation; ROBERT BICHON, who was sentenced to serve 35 months in federal prison, and ordered to pay restitution in the amount of $2,295,155.97 to various victims, and $141,163.13 to Washington Mutual; ROBERT SIGG, who was sentenced to time served, and was ordered to pay restitution in the amount of $141,163.13 to Washington Mutual joint; CHARLES WINNETT, who was ordered to serve 51 months in federal prison and ordered to pay restitution totaling $22,400,000 to Flag Star Bank, and $12,632,080.64 to Impac Warehouse Lending Group; and CHAD HEINRICH, who was ordered to serve 28 months in federal prison, and ordered to pay restitution totaling $22,400,000 to Flag Star Bank, and $12,632,080.64 to Impac Warehouse Lending Group. Some of the restitution orders are joint and several with respect to multiple defendants.
On February 7, 2006, HARRY LOU GAYLE, age 50, of Highlands Ranch, Colorado, an employee of GERALD SMALL, was charged by Criminal Information with one count of filing a false tax return for 2002. According to the Information, GAYLE received $44,000 for signing four false loan applications related to a real estate fraud, but did not report the proceeds on his tax return. GAYLE pled guilty on March 1, 2006 before U.S. District Court Judge Marcia S. Krieger, and is scheduled to be sentenced on June 26, 2006.
During the course of the investigation and prosecution assets obtained by SMALL and his associates were seized or restrained. These assets included 15 homes in Nevada and Colorado, a 2004 Jaguar, a 2003 Lexus, and over $8,000,000 in cash or bank accounts.
This case was investigated by IRS-Criminal Investigation and the FBI. The case was prosecuted by Assistant United States Attorney Matthew Kirsch.
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