Tuesday, July 14, 2009

HIgh School FB Coach Guilty On Fraud, Money Laundering

((HT: OC Register/Srisavasdi))

An ex-Mater Dei assistant football coach and former Tennessee Titans player pleaded guilty today to charges related to a bogus loan program that defrauded nine individuals of more than $5 million, federal prosecutors said.

Reed Kyle Diehl, a Cota de Caza resident who was arrested in March 2008, pleaded guilty to three counts of wire fraud and one count of money laundering, according to U.S. Attorney's Office spokesman Thom Mrozek.

Prosecutors said Diehl told victims involved in construction projects in Mexico that he could secure multimillion-dollar lines of credit.

Diehl will be sentenced Sept. 28 and faces a statutory maximum of 70 years in prison, Mrozek added.

The plea agreement states that Diehl told investors he would pool their money with that of other investors and make hard-money loans to businesses and individuals. The investors would then profit from a supposed rate of return.

But, the loans were not secured and no rate of return was earned, according to the agreement.

"Instead, much of the investors' funds were used by defendant to make payments of interest and/or principal to earlier investors, or were withdrawn by defendant's lifestyle and activities,'' the filing said.

Six investors were duped out of a total of $810,000 in Diehl's promissory note program, while four borrowers lost $4.2 million in Diehl's line of credit program, according to the agreement.

Diehl spent one year on the Mater Dei coaching staff and briefly played for the Titans after being an All-Pac-10 player at U.C. Berkeley. He also played football at Mater Dei.

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