A judge has been sentenced to a year in prison for concealing assets from the bank in order to qualify for a short sale."
A bank fraud suspect who once sat on the bench of the highest court in the state of Michigan will be spending the next year of her life behind bars the U.S. Attorneys office reported on Tuesday.
Diane M. Hathaway a former Michigan Supreme Court Justice was sentenced Tuesday to one year and one day in federal prison after having pleaded guilty in January to committing bank fraud in connection with a property in Grosse Pointe Park Mich.
Judge Hathaway resigned after the Michigan Judicial Tenure Commission called for her suspension in January 2013. The Commission recommended Hathaways immediate suspension from the court while the matter was investigated. As a result of the action Hathaway announced her resignation from the court. Since Hathaway retired this matter no longer falls within the jurisdiction of the Judicial Tenure Commission.
At the time of her plea before U.S. District Judge John Corbett OMeara the 58-year-old Democrat admitted that between 2010 and 2011 she knowingly engaged in a scheme to defraud ING Direct bank by concealing assets from the bank to qualify for a short sale."
According to the prosecutor a short sale is the forgiveness of debt by the bank to a borrower who claims financial hardship.
Besides her 366-days in prison Hathaway was ordered to pay restitution to the ING in the amount of $90000.
She will also serve two-years on probation once released from prison.
Michigan Attorney General Schuette said Public corruption scandals have damaged the publics trust in government and tarnished our states reputation. No matter who you are or what position you hold the same rules apply. I supported U.S. Attorney Barbara McQuades request for prison time and I appreciate her efforts along with those of FBI Special Agent in Charge Bob Foley to bring this case to a close."
Justice Hathaways real estate scam involved transferring properties out her and her husbands name into the name of their children in order to obtain a short sale. Her actions are offensive to the many Michigan families who have faced difficult times during Michigans economic down turn. As a justice on the highest court in Michigan Hathaways involvement in the alleged scam the FBI investigation and todays event undermines her ability to effectively sit in a position of judgment over Michigan citizens and the states judicial system.