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A former sales executive at Washington Mutual Inc.'s subprime lending unit Long Beach Mortgage was convicted of fraud yesterday by a federal court jury, Bloomberg News reported yesterday. Joel Blanford was found guilty yesterday of six counts of mail fraud for his involvement in a scheme to falsify loan documents that earned him more than $1 million in commissions from 2003 to 2005, said U.S. Attorney Benjamin Wagner. Blanford paid a loan coordinator in cash and checks to falsify documents, provide false verification of borrowers’ employment or professional licensing status, and to turn a blind eye to fraudulent representations contained in loan applications and other documents submitted to Long Beach Mortgage, prosecutors said. His commissions were based on the number of loans the bank processed.

Russell Wasendorf Sr., founder of the bankrupt commodities firm Peregrine Financial Group Inc., pleaded guilty to stealing more than $100 million from its customers, Bloomberg News reported yesterday. Wasendorf yesterday admitted to embezzlement, mail fraud and two counts of lying to federal regulators in an appearance before U.S. Magistrate Judge Jon Scoles in Cedar Rapids, Iowa. Wasendorf's crimes came to light on July 9 when the National Futures Association, an industry self-regulator, announced that about $200 million in customer funds the firm reported was on deposit at its bank were unaccounted for.

Steven Lippman, a former attorney in the law firm of convicted Ponzi schemer Scott Rothstein who admitted helping the firm make illegal campaign contributions, was sentenced to three years in prison, Bloomberg News reported on Friday. Lippman pleaded guilty in May to conspiracy to violate banking, election and tax laws. He said that he helped Rothstein’s now-defunct law firm, Rothstein, Rosenfeldt & Adler, illegally “bundle” contributions to Republican John McCain’s losing campaign in 2008 against President Barack Obama. The firm was the largest contributor to McCain’s campaign. Rothstein pleaded guilty in 2010 to racketeering, money laundering and wire fraud.

Russell Wasendorf Sr., the jailed executive of collapsed brokerage Peregrine Financial Group Inc., will not be able to pocket money from any book or movie deal about his scheme to defraud clients, according to details in a plea agreement, the Wall Street Journal reported today. The plea deal, publicly disclosed by federal prosecutors yesterday, indicates Wasendorf will face up to 50 years in prison and $3.25 million in fines. The founder of Peregrine must hand over any property or assets he accrued in the commission of the crime and cooperate with any effort from government officials to reimburse victims, according to the plea deal he signed. Wasendorf agreed to not sell any property or allow others to do so.

Laura Pendergest Holt, the former chief investment officer for Stanford Financial Group Co., was sentenced to three years in prison for obstructing a U.S. Securities and Exchange Commission probe of a $7 billion Ponzi scheme at the company, Bloomberg News reported yesterday. Pendergest Holt was sentenced today by U.S. District Judge David Hittner in Houston. She was the third-highest- ranking executive in the financial services firm Texas financier R. Allen Stanford built on what the U.S. said was a fraud based on bogus offshore bank certificates.

An FBI agent testified that Russell Wasendorf Sr., the indicted founder of Peregrine Financial Group Inc., has signed a plea agreement with prosecutors in which he admits to crimes including mail fraud, Bloomberg News reported yesterday. William Langdon, the U.S. Federal Bureau of Investigation agent whose affidavit supported the original criminal complaint against Wasendorf in July, disclosed the agreement today at a detention hearing federal court yesterday. Wasendorf, who has been in custody since his arrest on July 13, was indicted last month on 31 counts of lying to U.S. regulators about how much client money his now-bankrupt commodities firm had on deposit.

U.S. District Judge Robert Scola Jr. ruled that the U.S. Securities and Exchange Commission must defend a negligence lawsuit alleging that the agency failed to act appropriately after concluding that R. Allen Stanford was operating a Ponzi scheme, Bloomberg News reported on Saturday. Investors Carlos Zelaya and George Glantz may proceed with a claim that agency examiners determined four times before 2009 that Stanford was running a Ponzi scheme, Judge Scola ruled on Friday. Stanford is serving 110 years in prison for his $7 billion fraud. The lawsuit claims the SEC had a “nondiscretionary duty” to report Stanford to the Securities Investor Protection Corp., which compensates victims, after examinations in 1997, 1998, 2003 and 2004. The SEC sued Stanford in February 2009, alleging a “massive fraud” at Antigua-based Stanford International Bank.

Six weeks after the collapse of Peregrine Financial Group, tensions are rising between customers clamoring for the release of frozen funds and a bankruptcy trustee skeptical of records at a brokerage whose CEO confessed to forging financial data, Reuters reported yesterday. Customers say that Ira Bodenstein, the trustee in charge of recovering client money, is delaying payouts and keeping the customers in the dark as to why. Bodenstein rejects the criticism, saying that the firm's fabricated financials make him doubt the accuracy of the firm's accounting for its 24,000 clients.

The trustee liquidating Bernard L. Madoff's bankrupt brokerage won court approval to make a second customer payment that may reach $2.4 billion, Bloomberg News reported yesterday. Bankruptcy Judge Burton Lifland granted Irving Picard's request to hold back less money from a fund created to compensate investors for Ponzi scheme losses. Some customers have demanded 9 percent interest on their money. Judge Lifland's ruling that Picard can reserve just 3 percent for interest means the payment to customers may be $1 billion larger than if he had to hold back the bigger amount, Picard has calculated.

Federal regulators have accused a Hall of Fame college football coach of running a Ponzi scheme that defrauded fellow coaches and his former players, the New York Times DealBook blog reported yesterday. Jim Donnan, a head coach of both Marshall University and the University of Georgia during the 1990s, is accused of teaming up with an Ohio businessman to cheat investors out of $80 million. The Securities and Exchange Commission filed a civil lawsuit in Federal District Court in Atlanta yesterday seeking to recover the ill-gotten gains and impose a penalty on Donnan, who lives in Athens, Ga., and his Cincinnati-based partner, Gregory L. Crabtree.