Daniloo Pleads Guilty

Banker will avoid trial,do 10 years in prisonon federal fraud counts

By GARTH STAPLEY
BEE STAFF WRITER

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SAN FRANCISCO — Former Modesto mortgage banker Tony Daniloo pleaded guilty Tuesday to 122 felony counts and will be sentenced in March to at least 10 years in federal prison.

"That's a long time, you understand that?" U.S. District Court Judge William Alsup asked.

"Yes, your honor," replied Dan-iloo, dressed in a yellow jail jumpsuit. He has been in custody since he and his wife, Nansi, were arrested on separate state charges in December 2004.

If convicted at trial, Daniloo could have faced a maximum sentence of 20 years in prison and a $250,000 fine for each count.

Daniloo, 32, of Turlock admitted Tuesday to preying on low-income and minority clients with poor credit, and forging documents to qualify them for loans they wouldn't otherwise have received.

He also admitted to embezzling more than $4.5 million from lenders and his clients at DreamLife Financial in and around Modesto, where authorities say he used ill-gotten gains for luxury living and to pose as a philanthropist.

In the fall of 2004, DreamLife pledged $4.5 million to Turlock's Emanuel Medical Center and $1 million to California State University, Stanislaus. The now-defunct company also was a finalist for naming rights of the San Francisco 49ers football stadium.

Daniloo admitted Tuesday to using embezzled money for his own use. Authorities have said he bought expensive jewelry and fancy cars.

A Bee investigation in late 2004 exposed Daniloo's history of Bay Area bankruptcies, tax penalties and civil lawsuits. A subsequent review found that the Turlock homes of both sets of the couple's parents were "sold" to an elderly Alzheimer's patient about the time Tony Daniloo was setting up his business in Modesto.

He used the same woman's forged identity in other schemes, resulting in foreclosure on her South San Francisco home, according to a separate lawsuit. The woman had moved to Colorado and had no knowledge of the deals there or in Turlock, her son has told The Bee.

Four people attended Tuesday's proceeding in support of Daniloo, but they declined to comment afterward.

The expected sentence essentially will negate his plea agreement earlier this year with state authorities because that sentence — of six years, eight months — will run concurrently with the longer federal sentence. But the deal with state prosecutors requires that he repay $1.34 million to victims.

Alsup on Tuesday warned Daniloo: "In the federal system, there is no such thing as parole. If you're sentenced to 10 years, you serve 10 years with a tiny little deduct for good behavior."

Daniloo said he understood and waived his right to a jury trial.

The judge scheduled a hearing March 20 for final sentencing. Daniloo isn't likely to receive a 262-month term allowed under federal plea guidelines because he doesn't have a criminal record.

Nansi Daniloo, 31, recently agreed to settle state charges by repaying victims $368,000 and performing volunteer work. She faces no federal charges.

Bee staff writer Garth Stapley can be reached at 578-2390 or gstapley@modbee.com.