KNOXVILLE, TN— Three were arrested Monday and charged in a 39-count indictment for conspiring to defraud five banks from 2007 to 2011, federal officials said.
The indictment alleges that Ray M. Mubarak, 54, of Knoxville, Tenn., Dianna Mubarak, 52, of Knoxville, Tenn., and Blythe Bond Sanders, III, 35, of Norris, Tenn., conspired to defraud five banks of more than $6.7 million, officials said.
Ray Mubarak used the money to pay gambling debt and buy vehicles, according to reports.
Ray M. Mubarak was also charged with multiple counts of engaging in unlawful monetary transactions greater than $10,000 in bank fraud proceeds.
Records say Ray Mubarak told the banks that he would use the credit to purchase real estate, but instead put the money into his personal investment account where he would pay off gambling debts and buy vehicles, according to an NBC TV affiliate.
The TV reported stated that Ray Mubarak would overstate his income, which would help him secure loans, some up to $1.5 million.
Blythe, a realtor, is accused of preparing the loan documents for Mubarak “knowing that said loan closing documents were false and fraudulent,” according to records.
Knoxville-based attorney Stephen Johnson, who is representing Mubarak on the federal charges, said little about the case, the NBC TV report stated.
“I entered a not guilty plea on behalf of Mr. Mubarak, but that’s about all I can say at this point,” he added.
All three pleaded not guilty to the charges. Trial has been set for May 5.