The owner of a now defunct Tukwila real estate escrow firm was indicted in July by a federal grand jury on ten counts of bank fraud and one count each of mail and wire fraud.
The owner of Hartman Escrow, Inc. – Lori Lynn Andrew, 48, of Cashmere – was arrested and arraigned on the indictment Aug. 3, according to a media release from U.S. Attorney Annette L. Hayes. The Washington State Department of Financial Services arranged for a receiver to take over the escrow company in 2012 after finding evidence of fraud. Andrew’s license to act as an escrow agent was suspended in 2013 and has since been revoked.
According to the indictment, beginning in about January 2011, and continuing until July 2012, Andrew used a variety of means to defraud financial institutions and individual home buyers and sellers who were involved in various real estate transactions, according to the release. Andrew made, or had others make, false settlement statements on the transactions listing false or inflated fees and charges to hide the fact that she was embezzling money, according to the indictment. Andrew forged signatures on various statements and created false invoices, statements and bills; she altered and deposited checks to her company account that should have gone to others; she took funds from her trust account and transferred them to her personal account for her own use. Andrew used the money for casino payments, credit card bills and other personal expenses. Andrew defrauded individual customers as well as Bank of America, Wells Fargo, Citi Bank, Chase and GMAC totaling approximately $2 million, the indictment alleges.
Charges in the indictment are only allegations. A person is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Each count of bank, mail or wire fraud is punishable by up to 30 years in prison and a fine of up to $1 million.
The Washington State Department of Financial Institutions, the FBI, the Postal Inspection Service and the Housing and Urban Development Office of Inspector General investigated the case.
Special Assistant United States Attorney Hugo Torres and Assistant United States Attorney Norman Barbosa are prosecuting the case. Torres is a senior King County Deputy prosecutor specially designated to prosecute financial fraud cases in federal court.