Partner gets 7 years in mortgage fraud case

  • Article by: ROCHELLE OLSON
  • Star Tribune
  • March 4, 2009 - 11:35 PM

A Greenwood man convicted in a $6 million suburban mortgage fraud scheme received the same seven-year prison sentence Wednesday as his codefendant, with a Hennepin County District judge agreeing to free both men on bail pending appeals.

Shinon Lindberg, wearing a gray "Minnesota" sweatshirt and frayed blue jeans, chewed gum throughout the 45-minute hearing in front of Judge Mary DuFresne. He did not speak.

Two weeks ago, Scott Rosenlund of Chaska received the same sentence from DuFresne for his role in the scheme involving 10Spring Homes in the southwest suburbs, in which they were accused of buying properties, then reselling them to straw buyers, often on the same day, at inflated prices. The two men were found guilty in December of multiple counts of racketeering and theft involving seven homes.

An additional 15 charges are pending against the men and likely won't be resolved until the appeals are decided. In all, investigators say, their scheme involved about 50 houses and $100 million. Defense lawyers have disputed those numbers.

In arguing for leniency for Lindberg, defense lawyer Howard Bass said the banking industry was responsible for the housing bubble and eventual financial collapse that led to the investigation of 10Spring Homes. He argued that Lindberg's role was minor, merely referring investors and making mortgage payments for them.

He asked that Lindberg be sentenced to the workhouse and home confinement for about six years rather than prison. He defined justice as "the law tempered by mercy; anything else is simply vengeance."

Then Bass said to the judge, "I ask you to do justice rather than vengeance."

Assistant Hennepin County Attorney Emery Adoradio didn't buy Bass' argument that Lindberg's role was minor. "Defendant Lindberg helped create the very (housing) bubble they are now claiming to be victims of," Adoradio said. "They were part of the problem, not victims."

He noted that Lindberg himself submitted false loan applications. He asked for more than eight years in prison for Lindberg -- as he had for Rosenlund, who was president of 10Spring Homes.

Dufresne said Lindberg knew what he was doing was wrong when he lied on loan applications and participated in transferring money into a bank account for a mere 10 minutes. She called his crimes a "sophisticated scheme" with a number of victims.

Rosenlund has posted $50,000 bail and is free on appeal. Lindberg was handcuffed and taken into custody. Bass said he wasn't sure his family would be able to post the bail.

The two men were accused of orchestrating the scheme along with Celeste Sklar of Orono. Sklar pleaded guilty last spring to one count of racketeering.

Under the scheme, officials charged that they inflated the income of the straw buyers to qualify them for mortgages. The three would then split with the straw buyers the difference between what they had paid for the homes and the mortgages taken out by the straw buyers. They told the straw buyers that the properties would be resold and their loans would be repaid, but instead the homes fell into foreclosure.

Rochelle Olson • 612-673-1747

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