Former Executive Sentenced to 10 Years in Prison for Brokering $30 Million in Fraudulent Mortgage Loans

PITTSBURGH—A resident of Finleyville, Pennsylvania, has been sentenced in federal court to 10 years of imprisonment on his conviction of wire fraud conspiracy, United States Attorney David J. Hickton announced today.
Chief United States District Judge Joy Flowers Conti imposed the sentence yesterday on David McCloskey, 49, of School Place, Finleyville, Pennsylvania.
According to information presented to the court, McCloskey operated a mortgage broker company called First Atlantic Financial that brokered more than $30 million worth of fraudulent loans. The loans were fraudulent because the loan applications contained false representations related to the borrowers’ income and assets, which were supported by bogus documents prepared by McCloskey and his co-conspirators. Fraudulent appraisals were also part of McCloskey’s conspiracy. Most of the fraudulent appraisals were prepared by co-conspirator Kenneth Cowden, who was not licensed to prepared appraisals. His appraisals also drastically overstated the values of the properties serving as collateral for the loans.
Assistant United States Attorney Brendan T. Conway prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Mortgage Fraud Task Force for the investigation leading to the successful prosecution of McCloskey.
The Mortgage Fraud Task Force is composed of investigators from federal, state, and local law enforcement agencies and others involved in the mortgage industry. Federal law enforcement agencies participating in the Mortgage Task Force include the Federal Bureau of Investigation; the Internal Revenue Service, Criminal Investigations; the United States Department of Housing and Urban Development, Office of Inspector General; the United States Postal Inspection Service; and the United States Secret Service. Other Mortgage Fraud Task Force members include the Allegheny County Sheriff’s Office; the Pennsylvania Attorney General’s Office, Bureau of Consumer Protection; the Pennsylvania Department of Banking; the Pennsylvania Department of State, Bureau of Enforcement and Investigation; and the United States Trustee’s Office.