Beverly Hills woman convicted of mortgage fraud to be sentenced today

A Beverly Hills real estate appraiser convicted in a far-reaching mortgage fraud scheme is scheduled to be sentenced today in Los Angeles federal court.

A jury found Lila Marie Rizk, 42, of Trabuco Canyon, guilty last August of criminal conspiracy, bank fraud and numerous counts of loan fraud in connection with a scheme in which inflated mortgage loans were obtained for homes in some of California's most expensive neighborhoods.

Prosecutors recommended that Rizk be sentenced to almost nine years in federal prison, according to documents filed in U.S. District Court in Los Angeles.

"Rizk abused her position and breached her duties as a licensed real estate appraiser in the course of this criminal scheme," prosecutors wrote. "Rizk's inflated appraisals enabled the masterminds of the fraud scheme to steal over $40 million from federal insured lenders."

The scheme defrauded mortgage lenders by generating inflated mortgage loans on high-end homes in Beverly Hills, Bel Air, Holmby Hills, Malibu, Carmel, Mill Valley, Pebble Beach and La Jolla.

The conspirators in the scheme sent false documentation, including bogus purchase contracts and appraisals, to banks to deceive them into unwittingly funding mortgage loans that were hundreds of thousands of dollars higher than the homes actually cost, according to the U.S. Attorney's Office.

Lehman Brothers alone was deceived into funding more than 80 such inflated loans from 2000 into 2003, resulting in tens of millions of dollars in losses, according to prosecutors.

Eight other real estate professionals previously pleaded guilty to federal felony charges in connection with the scheme and are serving sentences ranging from probation to 14 years in prison.