Yes, you can go to jail for real estate fraud.

A former Fannie Mae employee will spend the next six years in behind bars after being found guilty of accepting more than a million dollars in bribes and kickbacks in exchange for selling Fannie Mae-owned foreclosures for less than market value.

Back in January 2018,  Ms. Shirene Hernandez was charged with accepting bribes for providing foreclosure properties to a select few real estate brokers and even  buying some foreclosures herself at below market value.  And nearly a year ago,  Ms. Hernandez was found guilty of two wire fraud counts that involved the deprivation of honest services as a result of the scheme.

What did she do?

Hernandez formerly worked at Fannie Mae in California as an REO foreclosure specialist and was tasked with the sale of properties foreclosed on by Fannie Mae books.

As a sales representative, a position she held from 2010 through 2015, Hernandez would assignwd Fannie Mae-owned properties and approve sales of the properties based on offers that were submitted.

But, court documents showed that Hernandez demanded and received bribes – mostly in the form of cash – in exchange for brokers getting the listings and commissions those brokers earned on real estate sales in question.

Hernandez also approved sales of Fannie Mae REOs at discounted prices to both herself and to brokers who paid her kickbacks.

As part of the scheme, Hernandez also received bribes for approving below-market sale prices of Fannie Mae properties to the brokers, all of which were violations of Fannie Mae rules and federal law.

How much did she make?

Hernandez also helped several family members become Fannie Mae-approved brokers, and then steered nearly $80 million in Fannie Mae listings to them, resulting in nearly $2 million in commissions in less than three years.

According to court documents, Hernandez received more than $1 million in benefits from the scheme, including cash kickbacks and equity in a Fannie Mae property she bought using said kickbacks.

And, according to court documents, Hernandez paid for that property using a duffle bag filled with $286,450 in cash, which she gave to her sister-in-law to bring to the closing.

Due to crime, pay the time

In addition to the 76-month prison sentence, Hernandez was also ordered her to pay $982,516 in restitution to Fannie Mae.