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Local edition SECONDARY MARKET Or ig i nat ion SIGTARP Cracks Down on Another Mortgage Fraud Case Office continues to weigh down on those who abuse the system. s e r v ic i ng A na ly t ic s these motions were invariably granted, Harrell's actions caused delays in the foreclosure process and caused the creditors to incur additional costs. "Today's sentencing makes it clear that foreclosure rescue schemes will not be tolerated and can result in time in federal prison," Romero said. "Harrell promised distressed homeowners that as long as they paid him monthly, he would prevent foreclosure on their homes. He sold false hope to those who needed hope the most. He committed bankruptcy fraud and defrauded banks holding the mortgages, including TARP banks." Harrell pleaded guilty to filing bankruptcy petitions in furtherance of a scheme to defraud creditors owning mortgages and to making false statements in a bankruptcy petition. "The integrity of evidence received by our bankruptcy courts is critical to the courts' ability to function effectively," Haag said. "This office will vigorously prosecute people who intentionally submit false and misleading information in federal bankruptcy proceedings." GSE Reaches Settlement with PNC PNC closer to meeting its repurchase obligations. PENNSYLVANIA // PNC Financial Services Group and Freddie Mac announced that they reached an agreement in principle to resolve substantially all indemnification and repurchase obligations related to loans sold to Freddie Mac between 2000 and 2008. According to the agreement, PNC Bank will pay Freddie Mac a total of $89 million—minus a credit of $8 million—to resolve certain existing and future repurchase obligations related to approximately 900,000 loans originated and sold to Freddie Mac primarily between 2000 and 2008. The intention of the decisions is to compensate Freddie Mac for certain past losses and potential future losses relating to denials, rescissions, and cancellations of mortgage insurance. This agreement follows the previously announced agreement in principle that PNC reached with Fannie Mae to resolve repurchase demands with respect to loans sold between 2000 and 2008. Now that these settlement agreements are under way, PNC Bank has resolved a large portion of the bank's outstanding and potential indemnification and repurchase obligations related to loans sold to the GSEs from 2000 through 2008. The agreements still have to gain final approval from the Federal Housing Finance Agency (FHFA). The amount of the settlements with Freddie Mac and Fannie Mae had been fully accrued by PNC Bank as of September 30, 2013. The M Report | 63 se c on da r y m a r k e t CALIFORNIA // The Special Inspector General for the Troubled Asset Relief Program (SIGTARP) aimed its laser sharp focus on eradicating foreclosure fraud and a California man running a foreclosure rescue scam. Christy Romero, SIGTARP, and Melinda Haag, United States attorney for the Northern District of California, announced Walter Bruce Harrell, 72, of Montara, California, was sentenced to 10 months in federal prison and three years of supervised release for bankruptcy fraud and for providing false statements in a bankruptcy proceeding. Harrell was indicted with eight counts of bankruptcy fraud and two counts of making false statements in a bankruptcy proceeding. Documents show that Harrell operated a scheme in which he offered to postpone foreclosure proceedings on the homeowner's property in exchange for a monthly fee. Harrell accomplished this by instructing homeowner clients to deed fractional interests in their properties to other individuals whom Harrell would pay to file bankruptcy petitions in court. Once the bankruptcy petitions were filed, Harrell would notify creditors—which included multiple TARP banks seeking to foreclose on his clients' properties—that the properties were part of an active bankruptcy proceeding. Because of "automatic stay" provisions of the U.S. bankruptcy code, the creditors were prevented from proceeding with foreclosure. Instead, the creditors were required to file motions to lift the automatic stays in bankruptcy court. Although