Real estate agent charged in kickback scheme

TAMPA — St. Petersburg real estate agent Gary Blankenship has been indicted on fraud charges in connection with what federal prosecutors say is a kickback scheme involving a failed condo conversion project.

Blankenship, 44, is charged with conspiracy, wire fraud and bank fraud. He faces a maximum of 30 years in prison on each charge if convicted, in addition to a monetary judgment.

Authorities allege Blankenship and another person charged in the case, Brenden Bolger, used a company named Capital Management Guarantee LLC to sell condos in The Arbors, a Hillsborough County condo building. The alleged criminal activity took place in 2005. Blankenship, prosecutors contend, promised buyers they would not be required to provide any money at closing; actually provided cash for borrowers to close on the units; facilitated the payment of kickbacks to his clients via Capital Management Guarantee; and facilitated submission of false loan applications to FDIC-insured financial institutions.

Bolger, authorities say, added various buyers' incentives, such as rental supplements, money to defray maintenance costs and a design credit to upgrade the units' amenities, to the purchase contract to help entice people to buy units. A buyer would then cancel the design credit, and Bolger would pay them an amount equal to the design credit through Blankenship, authorities allege. The buyer would then use that cash to pay closing costs. These financing arrangements were not disclosed on loan applications to banks and other financial institutions.

Bolger, one of the owners of Capital Management, previously pleaded guilty to his role in the conspiracy and is scheduled for sentencing Sept. 18.