Former Filipino Chamber of Commerce President Stephen Elmer Callo will spend 15 consecutive weekends at the Federal Detention Center in Honolulu for lying about his income on a loan application to get a $554,501 mortgage on a Makakilo home.
The 30 days of jail time is part of a three-year probation sentence U.S. District Chief Judge Susan Oki Mollway handed down Monday. She also fined Callo $3,000 and ordered him to perform 300 hours of community service.
Callo pleaded guilty to one count of wire fraud in January.
He must begin serving his jail term Sept. 6.
Callo was one of 14 people indicted in August 2010 for conspiracy, wire fraud and making false statements on loan applications in the largest mortgage fraud scheme prosecuted in Hawaii.
According to the two indictments, the fraud involved 46 residential properties on Oahu. However, prosecutors said the 14 defendants plus 10 others who were charged separately obtained about 400 mortgages to buy, sell and resell more than 90 properties between 2003 and 2008 using false information to qualify straw buyers for subprime mortgages.
One of the indictments charged Callo, a certified public accountant and mortgage broker, with preparing and signing letters containing false information about the employment histories of the straw buyers to make them appear qualified for the mortgages. He was also charged with signing two fraudulent loan applications but pleaded guilty to signing one application.
At his sentencing, Callo denied preparing or signing any false letters or talking to any lender representative who called to verify the information on the letters.
His lawyer, Howard Luke, told Mollway that other defendants had created a false letterhead using his name and falsified his signature on the letters. He said when Callo found out what they were doing, he ordered them to stop.
Some of those other defendants were Callo’s relatives, including ringleader Estrellita "Esther" Garo Miguel, president and owner of Easy Mortgage.
Mollway sentenced Miguel in January to 52 months in prison. She sentenced Miguel’s daughter, Jennifer Garin Miguel, to 17 months in prison and daughter Geraldine Garin Miguel Lukela to 30 days in jail. Other defendants received jail terms of up to eight months or probation.
