BEFORE THE HEARING BOARD
ILLINOIS ATTORNEY REGISTRATION
In the Matter of:
WARREN BALLENTINE, III,
Commission No. 2015PR00070
FILED --- August 26, 2015
Jerome Larkin, Administrator of the Attorney Registration and Disciplinary Commission, by his attorney,Rita C. Greggio, pursuant to Supreme Court Rule 761(d), complains of Respondent, Warren Ballentine, III, who was licensed to practice law in Illinois on May 9, 2002, and alleges that Respondent has engaged in the following conduct which subjects Respondent to discipline pursuant to Supreme Court Rule 770:
(Federal Criminal Conviction for Fraud)
1. Between December 2004 and May 2006, the following institutions were among those in the business of making loans, secured by mortgages, to real estate buyers: People's Choice Loans, Fremont Investment and Loan, Community First Bank, Long Beach Mortgage Company, Mercantile Mortgage, EquiFirst Corp., Mirabella Mortgage, Tri-Star Lending Group, Accredited Home Lenders, CTX Mortgage Co., LLC, and Mortgage Lenders Network USA (collectively, "the lenders"). Some of the lenders were institutions whose deposits were insured by the Federal Deposit Insurance Corporation.
2. To assess the risk involved in making certain loans, the lenders required loan applicants to provide them with truthful information including, but not limited to, the applicant's employment status, income, and intention to use the property as a primary residence. The lenders considered loans made to buyers who intended to use the property as their primary residence to be less risky. As a result, the lenders offered more favorable terms for those applicants, including lower interest rates, and loan amounts equal to the full purchase price.
3. Between December 2004 and May 2006, Respondent, along with co-conspirators Bobbie Brown, Wanda Rivera-Burton, and Brenda Tibbs, participated in a scheme to defraud the lenders by presenting them with loan applications containing materially false information, in an attempt to obtain money and property from the lenders.
4. As part of their scheme, Respondent's co-conspirators recruited individuals to buy certain properties in Chicago. The buyers submitted mortgage loan applications to the lenders containing materially false representations concerning, among other things, the buyers' intention to use the properties as a primary residence. Respondent was paid to represent the buyers in purchasing the properties, including at the closing, and he knew that the buyers had been fraudulently qualified for the mortgage loans. Furthermore, at the closing, Respondent encouraged the clients to sign documents, including occupancy statements, HUD-1 settlement statements, and loan applications, that Respondent knew contained materially false representations.
5. Through the scheme described above in paragraphs three and four, Respondent and his co-conspirators fraudulently caused the lenders to make at least 28 loans totaling approximately $10 million.
6. On January 24, 2013, a grand jury returned a six-count indictment against Respondent, charging him with one count of fraud, in violation of 18 U.S.C. §1341; one count of mail and wire fraud, in violation 18 U.S.C. §1343; two counts of bank fraud, in violation of 18 U.S.C. §1344; and two counts of making false statements to financial institutions, in violation of 18 U.S.C. §1014 and 2. A certified copy of the indictment is attached as Exhibit One.
7. The criminal matter was filed in the United States District Court for the Northern District of Illinois, Eastern Division, as USA v. Warren Ballentine, III, docket number 13-CR-00088. On October 24, 2014, after a four-day jury trial, Respondent was found guilty on each count of the indictment. A certified copy of the order stating the jury's findings is attached as Exhibit Two.
8. On July 21, 2015, the Honorable Matthew F. Kennelly sentenced Respondent to one day, time considered served, three years of supervised release, and payment of an assessment in the amount of $600.00, and restitution in the amount of $140,940.00. A certified copy of the judgment of conviction is attached as Exhibit Three.
9. As a result of the order of conviction and the conduct described above Respondent has engaged in the following misconduct:
committing a criminal act that reflects adversely on the lawyer's honesty, trustworthiness or fitness as a lawyer in other respects, by committing the criminal offenses of fraud, mail and wire fraud, bank fraud, and making false statements financial institutions, in violation of Rule 8.4(a)(3) of the Illinois Rules of Professional Conduct; and
conduct involving dishonesty, fraud, deceit or misrepresentation, by conduct including engaging in a scheme to secure fraudulent mortgage loans, by making misrepresentations to lenders, in violation of Rule 8.4(a)(4) of the Illinois Rules of Professional Conduct.
WHEREFORE, the Administrator respectfully requests that this matter be assigned to a panel of the Hearing Board of the Commission, that a hearing be held pursuant to Supreme Court Rule 761, and that the Hearing Panel make findings of fact, conclusions of fact and law, and a recommendation for such discipline as is warranted.
Rita C. Greggio
Jerome Larkin, Administrator