Federal prosecutors have filed a fraud charge against Michigan Supreme Court Justice Diane Hathaway, just a few days before she leaves the state's highest court in a scandal involving the sale of a Detroit-area home and suspicious steps taken to conceal property in Florida.
The charge was filed Friday as a criminal "information," which means it was negotiated and that a guilty plea is expected in federal court. Defense attorney Steve Fishman declined to comment Saturday.
Hathaway is resigning Monday, months after a series of questionable real estate transactions first were revealed by a Detroit TV station. Hathaway and her husband, Michael Kingsley, deeded a Florida home to a relative while trying to negotiate a short sale on a house they couldn't afford in Grosse Pointe Park.
The sale went through and erased any remaining debt they had with the bank, $600,000. The debt-free Windermere, Fla., home then went back in their names.
The bank fraud charge says Hathaway made false statements to ING Direct, transferred property to others and failed to disclose available cash — all in an effort to fool the bank into believing she had a financial hardship. Kingsley has not been charged.
Hathaway has refused to make any lengthy public comments. She told WXYZ-TV last spring that the property shuffles were a private matter.
The maximum penalty for bank fraud is 30 years in prison, although that would be a rare punishment for anyone and very unlikely for Hathaway. Nonetheless, some time in custody should be expected, predicts former federal prosecutor Lloyd Meyer of Chicago.
"Any bank robber who robs a bank with no gun and just a note goes away to prison. A judge who steals over half a million dollars should enjoy the same fate," said Meyer, referring to the amount of debt written off after the short sale. "As a former federal prosecutor, it would be unthinkable to have this type of defendant get a slap on the wrist."
Read More: http://news.yahoo.com/michigan-supreme-court-justice-charged-fraud-212553072.html
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