Lacey Phillips and Erin Hall are an unmarried couple who decided to purchase a home together in 2006. Their first application for a mortgage was rejected by Associated Bank. They next applied to Fremont Investment & Loan ("Fremont"), through a referral, Brian Bowling, one of Hall's clients. Unbeknownst to Phillips and Hall, Bowling was a "crook" (Judge Posner's words), "who brokered fraudulent loans."
Fremont accepted loan applications based on "stated income," that is, they didn't verify applicants' income. And you've probably heard the rest before: Hall and Phillips couldn't make loan payments, they defaulted and lost their home. What you've probably not heard before is this little twist: Bowling's testimony helped convict Hall and Phillips for mortgage fraud, in return for a smaller sentence.