Ex-Agent Reflects on Mistakes That Sent Her to Prison

Former REALTOR® and convicted felon Holly Pasut says lapses in business judgment landed her behind bars.

November 6, 2018

Holly Pasut

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Former real estate agent Holly Pasut explained how lapses in judgment led to her conviction in a complex mortgage fraud case.

Holly Pasut was well aware of the risks of violating laws governing the business of real estate. The former Charlotte, N.C.-based real estate agent and convicted felon provided a cautionary tale at Monday’s closing session of the REALTORS® Conference & Expo in Boston about the price she paid for a series of lapses in judgment. Pasut, a well-known practitioner in her area from the late 1990s through 2007, makes no excuses for the critical thinking errors that led to her guilty plea on charges of conspiracy to commit mortgage fraud and money laundering. “My decisions were made with a foolish heart,” she said. “These decisions were not [meant to] commit mortgage fraud.”

Pasut got caught up in a web of crime that began with a simple request from a business acquaintance. “He asked me to pay a referral fee, and I paid it,” she said. Pasut explained that she made the payment to the man, who wasn’t a licensed agent, in return for a promise to help her close a particularly tough listing—a home that had been languishing on the market as the financial crisis heated up more than a decade ago. It was the start of a series of poor decisions that led to her guilty plea and, ultimately, her two-year sentence at the Alderson Federal Prison Camp in West Virginia, which began in July 2014. 

Pasut, a single parent of three children, shared the personal vulnerabilities that contributed to her improper actions, conveying foibles many practitioners can relate to. “I had a fear of disappointing others. My sellers were getting frustrated. I was intent on getting the deal closed,” she said. “My codependency caused me to put myself in harm’s way in trying to help someone else.”

She learned from her lawyer that even if she had no intent to commit fraud, her participation in illegal activities spearheaded by someone else provided her with no cover. “Ignorance is not an excuse,” she said.

Pasut went on to detail the chain of bad decisions she made. When the lender called to say that the numerous repair costs listed on the closing documents would be a barrier to closing for the underwriter, Pasut, against her better judgment, agreed to delete them. And when the same “businessman” co-conspirator offered her a commission check, Pasut accepted it, even though she knew it was wrong. “Entitlement was another of my critical thinking errors,” she said. “I’ve shown him so many properties in North and South Carolina. I’d also heard of other agents who received checks from builders and others, even though they had nothing to do with the transaction.”

Putting it simply, she added: “I had a collapse of courage.”

Her time in Cube 44 in the minimum-security prison provided Pasut an extensive opportunity for reflection. “In life, we either win or we learn. I wasn’t losing in prison, I was learning by decluttering this home,” she said, pointing to her head. “I learned it’s always better to do the harder right than the easier wrong.”

Pasut, who authored a book about her experience, A Strange Path to Freedom, offered some additional reminders for agents and brokers to avoid replicating her mistakes:

  • Don’t put yourself in harm’s way as you’re trying to help someone else.
  • If you have to justify something to be right or reasonable, maybe it isn’t.
  • Don’t say yes when you ought to say no.

Regaining her freedom in 2016 was a revelation: “The day I was released, I felt like I was a new listing. Prison turned me upside down and inside out. I am a felon, but the title won’t define me. I found an opportunity to learn humility, sympathy, and honest self-reflection.”