Arizona developer pleads guilty in $38 million Ohio mortgage fraud case

Arizona developer pleads guilty in Ohio fraud case

COLUMBUS, Ohio — Prosecutors say an Arizona developer has pleaded guilty in a $38 million mortgage fraud case in Ohio.

Prosecutors say 57-year-old John Wanek of Phoenix gave false and inflated financial information to Merrill Lynch and CIBC World Markets Inc. to buy six Columbus apartment complexes.

Franklin County Prosecutor Ron O’Brien said Monday that Wanek secretly diverted hundreds of thousands of dollars to himself and let the properties go into decline.

O’Brien says contractors didn’t get paid for their work and tenants’ utilities were shut off.

Wanek pleaded guilty to eight charges, including money laundering. He is scheduled to be sentenced Sept. 1. The maximum sentence is 51 years in prison, but prosecutors agreed to ask for no more than nine.