DETROIT, Nov. 21 (UPI) -- Federal investigators say Michigan Supreme Court Justice Diane Hathaway cheated a bank of $600,000 in a real estate transaction.
Hathaway and her husband, lawyer Michael Kingsley, allegedly obtained a short sale on a house in the upscale Detroit suburb of Grosse Point by transferring a house they own in the Orlando area in Florida to Kingsley's daughter, The Detroit News reported. That allowed the couple to say they did not have the assets to pay the mortgage on their Michigan house, the U.S. Justice Department said in a civil forfeiture action filed Monday.
Kingsley and Hathaway "systematically and fraudulently transferred property and hid assets" so that ING Direct, which held the mortgage on the Grosse Point house, would allow a sale for less than the couple owed, U.S. Attorney Barbara McQuade said in a complaint.
According to records, the Florida house was transferred back to Hathaway about a month after the short sale.
The government is seeking forfeiture of the Florida house, the Detroit Free Press reported. The Grosse Point house, valued at about $1.5 million, sold for $860,000.
Hathaway is one of three Democrats on the state's highest court. Republicans have begun demanding her resignation, the News said.
A spokeswoman for the court said Hathaway emailed her fellow justices on Tuesday, saying she will not quit. The U.S. attorney's only comment on the case is that a civil forfeiture action does not necessarily mean criminal charges will be brought against the justice.
