Houchen sentencing

Judge will decide fate of former mayor on Monday. She could face 5 years in prison for fraud scheme. Former Huntington Mayor Pam Houchen will be sentenced Monday for her participation in a Huntington Beach real estate scheme.

The former mayor and seven other codefendants are scheduled to appear before U.S. District Judge Dave Carter at 7:30 a.m. in the federal courthouse in Santa Ana. The seven will be sentenced for their participation in a plan to illegally convert apartments into condominiums and sell them to unsuspecting buyers.

Prosecutors are recommending a five-year prison sentence for Houchen, but Carter could impose a sentence shorter -- or longer -- than that.

“Judges have more leeway now than they did a year ago,� said sentencing expert Mary Price of Families against Mandatory Minimums. A 2005 Supreme Court decision overturned a decades-old requirement that federal judges adhere to sentencing guidelines.

Houchen qualifies for a prison sentence of 21 to 27 months for her participation in the scheme, and could receive an additional 25 to 30 months for participating in a crime that resulted in the loss of more than $1 million, Assistant U.S. Atty. Andrew Stolper said in a previous interview. The recommendation doesn’t mean Carter will give her a stiff sentence.

“Judges have a lot more leeway now,� Price said. “If there were a lot of victims, the sentence might go up; if the defendant was a minor player, the sentence might go down. If she pleads guilty and cooperates, it could also go down.�

Defense attorneys might use her family situation to get her off the hook. Houchen, 48, is the mother of toddler triplets and is recently divorced from the children’s father.

Family obligations are not often considered relevant during sentencing, according to guidelines from the United States Sentencing Commission. But the judge might make an exception in this case, Price said.

“It sounds like one of those extenuating circumstances,� she noted.

As for where or when she goes to federal prison, that too will be decided by Carter, who was appointed to the bench in 1998 by then-President Bill Clinton.

“In terms of when the sentence begins, it is up to the judge,� court spokesman Thom Mrozek wrote in a recent e-mail. “It is very common in white-collar cases, when the defendant is free on bond, for the judge to allow the defendant to surrender several weeks after the actual sentencing hearing.�

Houchen was also charged with public corruption for purchasing property in a redevelopment zone while in office. To avoid state laws barring the practice, Houchen paid former border patrol officer Mike McDonnell to buy and then sell the apartment in exchange for help with building permits at City Hall, she has admitted.

In total, 15 apartment buildings were converted into about 45 condominiums, generating about $11 million. Houchen is reported to have sold two four-unit apartment buildings for a total of about $1.7 million. Realtor Phil Benson, who now lives in Hayden, Idaho, and is suffering from terminal cancer, was said to be the mastermind of the scheme, which has prompted state legislation to fix a loophole to prevent condo conversion fraud. Benson has pleaded guilty and could face $6 million in fines and a sentence of seven to nine years in prison.

Title officer Harvey Du Bose also pleaded guilty in the case. He was charged with forging documents to insure the transactions. He faces a seven-year prison sentence. Realtor Tom Bagshaw and investors Michael Cherney and Howard Richey also accepted the plea deal. Bagshaw faces 18 to 24 months in prison for two counts of wire fraud, whereas Cherney and Richey, who each pleaded guilty to making a false claim to federal authorities, face up to six months in prison.