Edina Broker Charged for Role in Frauds Totaling $20M

An Edina mortgage broker was charged late last week for his role in $20 million worth of mortgage fraud involving 57 properties.

Derrick Ivan Lance, 40, was charged in federal court on July 22 with one count of conspiracy to commit wire fraud. Investigators believe Lance conspired with other people from 2004 to 2007 to obtain mortgage loan proceeds based on fraudulent documents.

According to U.S. Attorney B. Todd Jones, among those working with Lance were Roger Bill Hanks, of Coon Rapids, who just last month pleaded guilty to one count of conspiracy to commit wire fraud in connection with the same case. Prosecutors believe people working with Lance identified residential properties available for purchase and recruited buyers, then told those buyers they'd receive kickbacks after the property transactions closed.

Jones believes Lance used his licensed mortgage brokerage and his position within it to help prepare and submit false mortgage loan applications, which misrepresented the buyers’ true financial situation. At that point, prosecutors are charging, Lance and the others disbursed approved loan proceeds into various title companies, then transferred those funds into bank accounts unaffiliated with the property buyers, concealing the undisclosed kickbacks. Prosecutors believe Lance received about $200,000 for his role in 26 of these transactions.

If convicted, Lance faces a maximum penalty of 20 years in prison. The case is being prosecuted by Assistant U.S. Attorney Tracy L. Perzel and is the result of an investigation by the FBI.