A disbarred Towson lawyer pleaded guilty in federal court yesterday to his role in a fraudulent property flipping scheme while a former business partner described his own flipping activities in another courtroom.
Angus E. Finney, who was disbarred in 1997, pleaded guilty to one count in a 17-count indictment, admitting that his illegal activities cost lenders who financed the flips between $350,000 and $500,000.
Finney was the ninth person convicted in recent months of defrauding mortgage lenders in property flips, where houses were bought and quickly resold at inflated values for a substantial profit, using falsified documents.
Finney promised to cooperate with prosecutors. Under federal guidelines he could be sentenced to 24 to 30 months in prison. Prosecutors agreed to recommend a reduction of as much as six months if he provides "substantial assistance."
After Finney pleaded guilty before Judge Marvin J. Garbis yesterday morning, his former business partner, Carl Schulz, took the witness stand in Judge Frederic N. Smalkin's courtroom as the second week of a jury trial began.
Schulz, who pleaded guilty this month, was a partner with Finney and Thomas "Tucker" Mayer in a flipping enterprise in 1996 and 1997. The partnership dissolved in acrimony in 1997.
Finney and Mayer were indicted, along with appraiser Guy Shaneybrook, for transactions done after that split. Mayer also has pleaded guilty. Shaneybrook is scheduled to stand trial in March.
Shaneybrook is also a defendant in the trial in which Schulz testified yesterday, as are Marcia K. McNeil, who worked with Schulz, and Narade Pramuan, an appraiser.
Schulz told the jury that he was a Southern Baptist minister in Oklahoma in the 1980s when he resigned after divorcing his wife and being accused of having an affair with a parishioner.
He said later he learned about flipping houses by watching infomercials on television.
He moved to Maryland in 1991 and, after briefly selling cars, sold insurance until he was caught submitting fraudulent applications. He surrendered his license and in 1996 began flipping houses with Mayer and Finney and, later, with McNeil.
Schulz described McNeil as a key player in falsifying documents for flips.
Schulz said that, operating through corporations, he signed contracts to purchase packages of houses, ranging from 10 to 193 at a time, but that he didn't actually buy them until he was set to finalize the flip.
Shaneybrook and Pramuan are accused of providing fraudulent appraisals that made the flips possible. Schulz said yesterday that Pramuan became a partner in 1998. He testified that he paid Pramuan more than $30,000 in profits.