Real estate agent sentenced for ripping off investors in PA
A real estate agent will serve five years in prison for defrauding investors and lenders in several states. Andrew Brosnac, age 48, of Mansfield, Texas. Brosnac, a real estate agent and investment consultant, pled guilty to conspiracy to commit bank fraud and wire fraud in connection with the sale and leaseback of businesses in Pennsylvania, New York, West Virginia, North Carolina, South Carolina, Alabama, South Dakota, California, Oregon, and Wyoming.
According to United States Attorney Peter Smith, between 2006 and 2008 Brosnac and co-conspirator Samuel Pearson, age 47, Hanover, York County, Pennsylvania, admitted using a group of companies to buy Jiffy Lube stores, automotive service businesses, convenience store/gas stations and other commercial properties, then selling them to investors in Pennsylvania and California. The investment properties included a Jiffy Lube store in Sayre, Bradford County, Pennsylvania.
In pleading guilty, Brosnac admitted arranging funding from banks and credit unions for investors to purchase the properties and then used other companies controlled by him and Pearson to lease and operate the properties for investors. Brosnac also admitted that he and Pearson provided investors and lenders with false and fraudulent financial information concerning the investment properties which induced loans and investments totaling approximately $19 million. In the plea agreement, Brosnac agreed that he received approximately $2.4 million in commissions and consulting fees from the sales of the properties.
Judge Yvette Kane sentenced Brosnac to five years in prison, followed by a period of three years’ supervised release, and a special assessment of $100, and ordered Brosnac to pay to victim investors and lenders restitution totaling $2,409,924.04 representing the commissions and consulting fees that he received as a result of the offense. Under the federal Sentencing Guidelines the advisory imprisonment range was 60 months, which is also the maximum statutory term of imprisonment.
Pearson, operator of Peanut Oil, was charged separately with conspiracy to commit bank and wire fraud in a Criminal Information filed in March 2011 and pleaded guilty in April 2011 pursuant to a plea agreement. He is awaiting sentencing before Senior U.S. District Court Judge William C. Caldwell.
The investigation was conducted by the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney George J. Rocktashel.