In the following press release Edward M. Yarbrough, United States Attorney for the Middle District of Tennessee, and My Harrison, Special Agent in Charge, Federal Bureau of Investigation, Memphis Field Office, announced that Fred Holder and Pamela Holder were indicted by a federal grand jury on Wednesday for wire fraud and bank fraud. Yarbrough made the announcement as part of a nation-wide initiative by the Department of Justice to prosecute mortgage and other fraud perpetrated against lending institutions.

The four count indictment alleges that from December 2004 through April 2006, the Holders engaged in a mortgage fraud scheme that involved the purchase of a luxury home in Hendersonville, Tennessee by an unqualified straw buyer. Fred and Pamela Holder caused the submission to mortgage lenders of false mortgage loan applications that overstated the straw buyer’s income and assets and falsely stated that the home would be the straw buyer’s primary residence. The indictment also alleges that the Holders used a portion of the resulting loan proceeds to purchase jewelry and other property.

“Given the current strain on the housing and mortgage industries, our office takes more seriously than ever, the prosecution of individuals and entities that defraud financial institutions,” United States Attorney Ed Yarbrough said. “Anyone submitting false or misleading information in loan applications or engaging in any other kind of mortgage fraud is on notice that the United States Attorney’s Office and other state and federal law enforcement agencies are focused on rooting out such illegal conduct.”

If convicted, Fred and Pamela Holder each face up to 30 years in prison, a $1,000,000 fine, and forfeiture of real and personal property derived from the scheme to defraud. Any sentence following conviction will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and applicable federal statutes.

This case is being investigated by the Memphis Field office of the Federal Bureau of Investigation under the supervision of Special Agent in Charge, My Harrison. The United States is represented in the case by United States Department of Justice Trial Attorney Peter Frandsen and Assistant United States Attorney Eli Richardson.

The public is reminded that an indictment contains only charges and need not be supported by proof of guilt beyond a reasonable doubt. The defendants are presumed innocent and are entitled to a fair trial at which the United States has the burden of proving guilt beyond a reasonable doubt.

Update on Wednesday, April 15, 2009 at 7:12AM by The Editor - Ian Shuter - ACFE, DMS

Edward M. Yarbrough, United States Attorney for the Middle District of Tennessee and My Harrison, Special Agent in Charge, Memphis Division, Federal Bureau of Investigation, announced that yesterday a jury convicted Pamela Gail Holder of two counts of wire fraud and two counts of bank fraud. The guilty verdict followed a one-week trial before U.S. District Judge Aleta Trauger.

Dr. Holder, a professor of nursing at Middle Tennessee State University and the former coordinator of the statewide Tennessee Board of Regents On-Line Degree Program, and her husband, Fred “Fat Man” Holder were originally charged in a four-count indictment in June 2008. (Fred Holder died in 2008). At trial, the jury heard evidence that Dr. Holder and others helped orchestrate a multi-million-dollar mortgage-fraud scheme. The scheme involved a “straw buyer” with a good credit score who was deceived by Dr. Holder into securing $2.4 million in loans for the purchase of a $1.5 million dollar home in Hendersonville, Tennessee. The jury heard evidence that, in the months leading up to the purchase, Dr. Holder helped create documents that greatly inflated the straw buyer’s income and falsely claimed that the straw buyer was President of “Team Fat Man” – an automotive sales business operated by Dr. Holder’s deceased husband. Through those documents and other fraudulent misrepresentations, Dr. Holder was able to qualify the straw buyer for large loans obtained at Bank of Nashville, Countrywide Home Loans, and First Tennessee Bank that far-exceeded what the straw buyer could afford. After the purchase of the lavish home, Dr. Holder and her husband occupied the property and spent the excess loan funds on various purchases, including several pieces of expensive jewelry. When the straw buyer was unable to make the approximately $10,000 monthly mortgage payments, the mortgage defaulted and the property was foreclosed upon.

Sentencing is set for July 10, 2009.

DOJ Press Release