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Winfield woman was involved in mortgage fraud, gets 5 years probation

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Wednesday, Dec. 15, 2010

A former bank manager from Winfield has been sentenced to five years of probation including six months of house arrest for wire fraud.

Crystal Spreng, 40, of 329 Stoney Hollow Road, Cabot, was sentenced in federal court Tuesday by Judge Nora Barry Fischer.

U.S. Attorney David J. Hickton said Spreng was involved with mortgage fraud while she was a manager of a Citizens Bank branch in the Bloomfield section of Pittsburgh and elsewhere.

The conspiracy happened from February 2005 to December 2007. Spreng was indicted in June 2009.

Assistant United States Attorney Brendan T. Conway said Spreng "provided false documents to mortgage lenders representing that borrowers had bank account balances at Citizens Bank consistent with representations made to the lenders in fraudulent loan applications."

Spreng's actions verified the information that lenders used decide to lend money.

The false documents included the names of some porported borrowers who didn't have accounts at Citizens Bank. Others had accounts but far less money in their accounts than the false balances given to the lenders.

Spreng was initially charged with nine counts involving more than $536,000 in wire transfers for properties in Verona, Pittsburgh, Ambridge and West Mifflin.

She pleaded guilty to a single count involving one wire transfer involving $81,000 for a property in Penn Hills.

Conway said Spreng accepted responsibility for the other counts. She wasn't found not guilty of them, he said.

Spreng wasn't ordered to pay restitution because the government couldn't clearly identify all of the victims. If that were possible, she would have been ordered to pay restitution, he said.

During her house arrest, Spreng will be allowed to work in a restaurant in Harrison, court records show.

According to records, three others were charged with wire fraud conspiracy: Daniel Hoey, 43, of Sewickley; Robert Arakelian, 47, of Pittsburgh's Friendship neighborhood; and Robert J. McCully III, 37, of the 500 block of South Avenue, Verona.

In July, McCully was sentenced to 18 months in prison followed by three years of probation.

Hoey and Arakelian have pleaded guilty and are scheduled to be sentenced.

Who to call if fraud suspected

Mortgage industry employees with knowledge of fraudulent activity are encouraged to call the Mortgage Fraud Task Force at 412- 894-7550. Consumers are encouraged to report suspected mortgage fraud by calling the Pennsylvania Attorney General's Consumer Protection Hotline at 800- 441-2555.

Source: U.S. Attorney's Office

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