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Michigan Supreme Court Justice Pleads Guilty to Bank Fraud Charge

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by Publius
Posted January 29, 2013, 2:55 PM

The Detroit News reports:

Former Michigan Supreme Court Justice Diane Hathaway pleaded guilty Tuesday to bank fraud and could face up to 18 months in prison.

Hathaway negotiated a guilty plea with federal prosecutors and waived her right to indictment or trial. She appeared before U.S. District Court John Corbett O'Meara in his Ann Arbor courthouse just eight days after stepping down from the high court.

"Do you still ask me to accept your guilty plea?" O'Meara asked Hathaway.

"Yes, your honor," she replied.

O'Meara set a May 28 sentencing date. Depending on how much the judge rules Hathaway defrauded her bank in a scheme to get a short sale, she'll pay up to $90,000 in restitution, according to her attorney, Steve Fishman.

Federal prosecutors have accused Hathaway of concealing assets and transferring homes to stepchildren in a scheme to get mortgage lender ING Direct to forgive $600,000 owed on a $1.5 million Grosse Pointe Park home and unload the lakefront property in a November 2011 short sale.

Fishman could not explain why his client shuffled the homes around, resulting in the fraud.

"It was dumb," Fishman told reporters. "There wasn't any reason for it. It made no sense." . . .

Under the plea agreement, Hathaway could face 12 to 18 months in prison and have to pay the bank $90,000 in restitution, said Assistant U.S. Attorney Daniel Lemisch.

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