Two face charges in construction loan fraud

 (Salt Lake Tribune) Two Utah housing developers have been indicted on federal fraud charges for securing an $18 million loan for a Salt Lake City condo project and then allegedly using most of the money to finish other houses and for personal endeavors -- including a vacation in France.

An indictment released Friday charges Gregory Lee Hansen, 55, West Jordan, and Uriah A. Kennedy, 34, Midvale, with conspiracy, wire fraud and money laundering.

In addition, Misiona Patane Jr., 45, West Valley City, pleaded guilty Monday in a related indictment for his part in the alleged scheme.

Hansen and Kennedy were involved in developing an 80-unit condominium project on 644 W. North Temple St. that was called the Kennedy Town Center Project. To fund the project, they obtained an $18 million loan from Arkansas National Bank, which has an office in St. George.

The loan was to go solely to the condo project, but an FBI investigation showed that Hansen and Kennedy diverted millions for other projects, including a number of unfinished residential homes that they were building through their company Tradewest Homes, and for personal uses, according to the indictment.

To conceal the diversion, Hansen, Kennedy and Patane, an employee of their companies, falsified invoices to make it appear that the money was going toward construction of the condominium project.

Original Article