Former Youngstown lawyer indicted

Staff report

CLEVELAND

A federal grand jury has indicted a former Youngstown lawyer and aide to U.S. Rep. James A. Traficant Jr. on 12 counts of financial-institution fraud, the U.S. Attorney said.

R. Allen Sinclair, 51, of Suwanee, Ga., was an aide to the congressman from 1998 to 2000 and resigned from Ohio law practice in March 2012.

As owner and operator of Newport Investments LLC and and Newport Development Inc. in Youngstown, Sinclair solicited money from investors, promising them annual returns of about 10 percent and telling them their funds would be used to acquire and renovate Youngstown properties.

Five investors invested a total of about $147,000, the indictment said.

Sinclair knew the properties needed little or no renovation and converted the money to his personal use, the indictment said.

Beginning in 2005, Sinclair acquired the 12 homes in Youngstown, Struthers, Austintown and Canfield through land trusts he created for each property.

Sinclair fraudulently misled the sellers into believing the land trusts had assumed the mortgage payments, the U.S. attorney said.

After making minimum monthly payments, Sinclair stopped paying the mortgages without notifying the sellers, who were unaware they were still obligated to the loans, according to the indictment.

As a result, the properties went into foreclosure, causing substantial losses to the lenders and the federal agencies that insured them, the indictment said.

The case was investigated by the FBI with assistance from the U.S. Department of Housing and Urban Development and the Ohio Attorney General’s Office.

Sinclair testified against Traficant in the 2002 bribery and racketeering trial, in which Traficant was convicted.

Traficant was expelled from Congress, spent seven years in federal prison and died in a farm accident last year.