Los Angeles, California - A Gardena man has pleaded guilty to federal criminal charges that he defrauded non-bank lenders to obtain loans, resulting in at least $550,000 in losses.

Troy Rustill Stroud, 53, entered his plea on Monday, August 17, before United States District Judge Stephen V. Wilson. Stroud pleaded guilty to one count of conspiracy to commit wire fraud.

According to his plea agreement, over the course of several years and continuing through May 2020, Stroud defrauded non-bank lenders by supplying them with false information to obtain loans. Stroud created a number of corporations that purported to be in business, but, in fact, were not.

Stroud conducted a series of transfers from bank accounts in some of his corporations’ names to accounts held in other names to make it appear that the corporations were engaging in business. He then paid others to pretend to be officers of his corporations and used those officers’ names to apply online for corporate business loans, falsely reporting that the corporations had substantial revenues, when they had none.

When Stroud received the loan proceeds, he used them to pay for his personal expenses and defaulted on the loans immediately, or after one or two payments.

As a result of this conspiracy, Stroud took in more than $1.5 million. The non-bank victim lenders, which oftentimes have less stringent underwriting guidelines and may be more susceptible to fraud, lost at least $550,000, Stroud admitted in his plea agreement. Investigators estimate the losses to be approximately $1 million.

Stroud was arrested in the City of Gardena in May 2020, and evidence recovered following his arrest indicated that he was planning to commit additional fraud.

Judge Wilson scheduled sentencing for February 22, 2021, at which time Stroud will face a statutory maximum sentence of 20 years in federal prison.

This case was investigated by the FBI and is being prosecuted by Assistant United States Attorney Andrew Brown.