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Friday, Sept. 19, 2014

Ex A.G.s Mark Shurtleff, John Swallow face civil lawsuit over Bank of America case

By Dennis Romboy, Deseret News

Published: Tue, Aug. 12 5:31 p.m. MDT

 Former Utah attorney general John Swallow, right, and his attorney Stephen McCaughey enter Judge Royal Hansen's courtroom in Salt Lake City Wednesday, July 30, 2014.  Swallow along with former Utah attorney general Mark Shurtleff are charged with receiving or soliciting bribes, accepting gifts, tampering with evidence, obstructing justice and participating in a pattern of unlawful conduct.

Former Utah attorney general John Swallow, right, and his attorney Stephen McCaughey enter Judge Royal Hansen's courtroom in Salt Lake City Wednesday, July 30, 2014. Swallow along with former Utah attorney general Mark Shurtleff are charged with receiving or soliciting bribes, accepting gifts, tampering with evidence, obstructing justice and participating in a pattern of unlawful conduct.

(Al Hartmann, )

SALT LAKE CITY — Already facing multiple criminal charges, former Utah Attorneys General Mark Shurtleff and John Swallow have been sued by a Salt Lake couple over their handling of a lawsuit against Bank of America.

Darl and Andrea McBride say Shurtleff and Swallow personally benefitted from their involvement in the case at the expense of Utah homeowners, including the McBrides, whose houses Bank of America had foreclosed on. The couple says the bank forced them into default as a condition of modifying their loan and then tried to take their home.

Kevin McBride, a lawyer and Darl McBride's brother, said the criminal case against the state's two former top law enforcement officials triggered the lawsuit filed last week in 3rd District Court.

Some felony charges against Shurtleff and Swallow, including receiving or soliciting a bribe and accepting gifts when prohibited by law, are connected to the Bank of America case.

"Mr. Swallow got a big campaign contribution. Mr. Shurtleff got a new job and Utah homeowners got nothing," Kevin McBride said.

Lawyers for Shurtleff and Swallow did not respond to requests for comment.

In the criminal case, Swallow faces 11 felonies and two misdemeanors, while Shurtleff faces 10 felony counts. A hearing in the case scheduled for next Monday was postponed until Oct. 20.

In March 2011, Timothy and Jennifer Bell filed a federal lawsuit against Bank of America, challenging its foreclosure practices. They claimed the bank induced them into default as a condition of a home loan modification.

The attorney general's office later intervened in the Bells' case, taking the position that Bank of America's practices in Utah were illegal.

In August 2012, the Bells hosted a fundraiser for Swallow's 2012 attorney general campaign that cost $28,000 to put on but that he reported on campaign finance disclosures as a $15,000 in-kind donation and later a $1,000 donation, according to the criminal charges.

Later that month, Swallow met with Bank of America lobbyists and told a division chief in the attorney general's office that he might have given the bank the impression that if the Bells' case was settled, the state would drop out of the lawsuit.

The Bells accepted a loan modification from the bank on Oct. 30, 2012. On the same day, Shurtleff interviewed for a job in Washington, D.C., with the law firm Troutman Sanders, whose clients include Bank of America.

During his last week in office, Shurtleff dismissed the claim in the Bells' Bank of America lawsuit over the objections of the attorneys in his office who worked on the case. Shurtleff went to work for Troutman Sanders in January 2013 but quit six months later, saying being away from home was hard on his family.

"We knew what Bank of America did was wrong in leading my brother and other homeowners into default," Kevin McBride said. "But the whole connection between the attorney general giving protection for that kind of activity never became clear until the criminal case was filed just a few weeks ago."

Kevin McBride said they "realized at that point in time that whole arrangement had essentially been a bribe. There's no other way to say it."

The lawsuit, which names Bank of America as a defendant, seeks at least $33 million, including $30 million in punitive damages.

Bank of America had no comment about the lawsuit but said in a statement that it reached an agreement with the Bells through the normal review process. The bank said it settled with the Bells because they met all of the requirements for a loan modification and not because of their lawsuit.

Darl McBride also figures into another aspect of the criminal charges against Shurtleff. He was involved in a dispute over a $200,000 loan he had made to businessman Mark Robbins but was not repaid. Darl McBride created a website attacking Robbins.

Shurtleff intervened and in a May 2009 meeting at Mimi's Cafe with Darl McBride, which he secretly recorded and turned over to criminal investigators, asked what he could do. Darl McBride told him he needed $2 million to back off Robbins. Shurtleff told him he could ge the money from Marc Sessions Jenson, a businessman for whom Shurtleff had brokered a plea deal in a securities case.

A month later, Shurtleff met with Jenson at the posh Pelican Hill resort in Southern California where Jenson was living. Jenson, who had yet to pay $4 million in restitution as part of his plea deal, told Shurtleff he didn't have the money. Jenson is now in prison for failing to pay the restitution.

Contributing: Becky Bruce

Email: romboy@deseretnews.com

Twitter: dennisromboy; DNewsPolitics

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1. SharpHooks
Lake Sammamish, WA,
Aug. 12, 2014

It's not getting any easier for these two.

2. bill in af
American Fork, UT,
Aug. 12, 2014

The story is getting worse. Why didn't the state delegates see that Swallow was just a Shurtleff clone. As a moderate, I supported Reyes 100% after vetting the candidates. Seems like the caucus system is letting us down when the far right tries to control politics for us all. Swallow only got elected in the first place because of the Eagle Forum.

3. rik-nell
San Mateo, CA,
Aug. 12, 2014

True - very difficult on these men. Supposedly the U.S. Attorney is fueling this due to extreme differences of opinion.

4. Cherilyn Eagar
Holladay, UT,
Aug. 12, 2014

This is getting more hyped and disgusting every day, first the political profiteers in the state legislature desperately distancing themselves from a media-driven scandal, and now the private opportunists swarming like vultures circling their prey.

At the end of the day, in the Book I believe in, we will all be accountable to a much higher Judge in the Highest Court of All. I hope that we will all be as forgiven as we are forgiving. I do believe that Truth will prevail.

5. FreedomFighter41
Provo, UT,
Aug. 12, 2014

I remember when redshirt and 2 bits attacked me for bringing up how my aunt was taken advantage of by Bank of America and how she lost her house. I remember them blaming her for losing her home instead of the illegal activity that occurred inside of our AG's office and in doughnut shops that permitted people like my aunt to be ripped off.

Where are the Swallow/Shurtleff defenders now? Why are they suddenly so silent? Time to be accountable and admit that you were wrong.