Forfeiture Complaint Accuses Michigan Justice of Defrauding Bank in Short Sale Transaction
The federal government is seeking forfeiture of a Michigan justice’s Florida home in a civil complaint that claims she defrauded a bank in a short sale transaction.
Justice Diane Hathaway and her husband, lawyer Michael Kingsley, are accused of transferring the Florida property to Kingsley’s daughter to facilitate the short sale of another home they owned in a Detroit suburb, report the Associated Press, the Detroit News, WXYZ.com and the Lansing State Journal.
The short sale of the Michigan property erased $600,000 in mortgage debt, the suit says. Afterward, the Florida property was transferred back to the couple, according to the suit.
Hathaway’s lawyer declined to comment when contacted by the publications. Hathaway’s office provided a statement to the Detroit News that read, “Justice Hathaway is not resigning. Period.”
Michigan Supreme Court Chief Justice Robert Young Jr. told the Detroit News that the federal allegations are a “dreadful development” and repeated his call for Hathaway to explain the real estate transactions.
WXYZ first reported the short sale allegations last spring.
