HARRISBURG, Penn. – A Texas real estate broker was indicted by a federal grand jury Friday for allegedly defrauding credit unions, banks and investors out of $16 million in connection with the sale and leaseback of Jiffy Lubes and other automotive service companies in Pennsylvania, New York, North Carolina, and Wyoming.
Prosecutors say Andrew Brosnac, 47, financed his scheme with almost $7 million of member business loans from Great Lakes CU, Travis CU and California CU, and separate commercial loans from several banks using false financial information.
Brosnac allegedly diverted funds from the sale of the properties to cover lease payments and expenses and to buy new properties and received approximately $1.9 million in commissions and consulting fees from the sales of the properties. The scheme included the use of companies under the names “Commercial Concepts,” “Realty Concepts,” “BF Oil,” “Peanut Oil,” “Viper Gas,” “Sierra Oil Management,” and “NYACOR.” Several of those companies have filed since for bankruptcy.
Brosnac is charged with 15 counts, including conspiracy, bank fraud, and wire fraud.
Samuel Pearson, also 47, an alleged co-conspirator, pled guilty to related charges of conspiracy to commit bank and wire fraud in April 2011 and is awaiting sentencing.