A Uniontown councilman involved in a mortage fraud scheme deposited more than $1.5 million in loans and lines of credit into his personal bank account at the direction of his daughter, according to federal prosecutors.
Marlin Sprouts Jr., 52, who took office in January, was charged last week with one count of conspiracy.
Sprouts claimed he was duped into participating in the scheme by his daughter, Tiffany Lynn Sprouts, 28, and her business partner, Michael Pope, 43, both of Washington County.
Prosecutors allege that Tiffany Sprouts and Pope created false financial records to inflate a buyers' income and assets in a scheme that cost banks and other mortgage lenders between $1 million and $2.5 million.
Marlin Sprouts, a teacher at Lafayette Middle School in the Uniontown Area School District, denies signing any of the documents related to the fraud.
"The FBI showed me a bunch of checks paid to me, but those were not my signatures on the checks," he said Monday. "That was good news for me. The high-priced checks were indeed forgeries."
Sprouts told the Tribune-Review last week that he backed out of the deal after he realized that he was being used.
However, a federal arrest warrant unsealed yesterday revealed that he received more than $28,000 for participating in the scheme.
Marlin Sprouts was one of several straw buyers recruited by his daughter and Pope, according to the arrest warrant.
Prosecutors claim that in January 2005, Marlin Sprouts deposited $200,000 he received from his daughter into his bank account. Two months later, Sprouts obtained a $922,500 mortgage and two lines of credit totaling more than $372,000, which he deposited into his account.
Prosecutors allege that Sprouts made some of the monthly mortgage payments "to deter further examination and to avoid foreclosure of the loans."
Marlin Sprouts claimed in documents that the house he was buying in Peters in Washington County would be his primary residence, although he lives in the Fayette County seat and was elected to city council in November.
The Peters home was owned by Michael Pope and his ex-wife and was being sold as part of a divorce settlement. Lynn Pope alleges that her name was forged on closing documents for the sale of the house.
The sale price was $288,000, according to the lawsuit, but the settlement documents showed a $1.2 million price.
Lynn Pope alleges that her former husband wanted her to sign over more than $615,000 to him after the deal closed. She refused, later learning that the deal had gone through anyway and that someone had forged her signature on the closing agreement, according to the lawsuit.
Tiffany Sprouts pleaded guilty last year and is awaiting sentencing on charges of money laundering, bank, wire and mail fraud. Pope was charged last week with conspiracy.
Another defendant, James A. Spike, 43, of Republic, Fayette County, was charged last week with bank, wire and mail fraud, and money laundering. He applied for a $521,000 mortgage to buy a home, then transferred more than $185,000 of the money to a bank account controlled by Tiffany Sprouts, according to an arrest warrant.
The U.S. Attorney's Office is seeking forfeiture of property in Bethel Park that is the subject of mortgage foreclosure proceedings in Allegheny County. A property in Springdale, also in Allegheny County, also is in foreclosure.
Larger text
Smaller text
Print this article
E-mail this article
