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Former owner of title search co. took nearly $2M from clients.

September 8, 2010

Ex-businesswoman admits to wire fraud

By Terrie Morgan-Besecker tmorgan@timesleader.com
Law & Order Reporter   |   Terrie Morgan-Besecker on Facebook   |   @TLTerrieMorgan on Twitter

SCRANTON – The former owner of a Kingston title search company has agreed to plead guilty to stealing nearly $2 million from 92 clients who did business with her.

Elizabeth Sichler, 58, of Harveys Lake, agreed to plead guilty to a single count of wire fraud. The U.S. Attorney’s Office agreed to drop a charge of bank fraud and making false statements to law enforcement authorities in exchange for the plea.

The bank fraud and false statement charges were based on Sichler’s alleged forgery of her daughter, Karen’s, signature to obtain $3,650 from Karen’s bank account.

Sichler was arrested on June 8 following an investigation by the U.S. Secret Service that was prompted by complaints from dozens of home buyers and sellers.

Federal prosecutors say Sichler, who owned Priority Search Inc., kept part of the money that was paid her by home buyers to pay off first and second mortgages held by a seller, along with   other taxes, fees and other costs associated with real estate transfers.

The thefts, which occurred from July 2005 to November 2008, entailed 58 property transactions affecting 92 victims for a total of $1,980,063, according to charges filed Wednesday in federal court.

According to the charges:

As a closing agent, Sichler was entrusted with the funds, which were held in a real estate escrow account, but she failed to pay off the debts for which the money was earmarked.

Clients were unaware anything was wrong because Sichler would appear at a real estate closing with checks from the real estate escrow account. Unbeknownst to the clients, after the closing she would access the account online and issue a stop payment order. Sichler’s employees did not know of her activity because she alone had control over the bank account.

Prosecutors say Sichler was able to hide the thefts for so long by creating a Ponzi scheme in which she would use money obtained from new clients to cover shortages in her escrow account.

The scheme began to unravel in July 2008, however, due to the slump in the housing market that resulted in a steep reduction in business for Priority Search.

In earlier years it was not uncommon for the company to handle several dozen closings a month. But by mid 2008, it was handling only about 10 per month, according to the charges. That left her with few victims she could use to cover the shortages.

The Secret Service got involved after several sellers came forward to report they had been advised by their bank that the first mortgages on the properties they sold had never been paid off.

Sichler signed the plea agreement on Aug. 18, but it was not filed in federal court until Wednesday.

The charge carries a maximum sentence of 20 years in prison and a $250,000 fine.
 

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