A Montana State Prison inmate with a history of theft, bad checks and probation violations is facing new charges in connection with his mortgage lending practices in Helena.

Scott W. Hilgers, 34, was indicted by a grand jury last month of scheming to defraud mortgage companies and conspiracy. Similar charges are pending against Todd Jeremy Rice of Boulder.

The two also are accused of using false statements to obtain $686,000 in electronic funds transfers.

According to the indictment, Hilgers was hired as an agent in 2004 by Tri-West Mortgage. The company lends money directly to borrowers, making a profit from the loan processing fees.

These mortgage lenders then sell the mortgages to banks or other investment companies, using the money generated from the sales to replenish their reserves and make new loans.

As a Tri-West agent, Hilgers solicited new borrowers. His duties included determining their credit worthiness, net worth and credit risk.

Between October 2004 and October 2005, Rice applied for four residential mortgages, which were arranged by Hilgers, allegedly using fraudulent information.

“… without the false statements the mortgage would (a) not be approved at the more favorable interest rate obtained, (b) not be approved for 100 percent financing, or (c) would not be approved for the mortgage at all,” Carl Rostad, criminal chief assistant U.S. attorney, wrote in the indictment.

On Oct. 29, 2004, Rice finalized the purchase of a home on Woodson Road in Helena. He purchased a home on Gallatin Avenue on Sept. 16, 2005; a home on Poplar Street on Sept. 20, 2005; and a home on Applegate Drive on Oct. 21, 2005.

Rostad claims that all of these homes were purchased based on false representations as to income and a false representation that Rice would occupy the property as his primary residence.

No information was available outside of the indictment, since the U.S. attorney’s office doesn’t comment publicly on ongoing cases.

Tri-West Mortgage didn’t return a telephone call Monday seeking a comment.

A call to the telephone number listed for Rice said the line has been disconnected. Hilgers also couldn’t be reached for comment, but Bob Anez, spokesman for the Montana Department of Corrections, confirmed Hilgers is in the state prison system.

Anez noted that Hilgers initially was given a 36-month sentence in 1993 for issuing a bad check, but the jail time was deferred as long as he stayed out of trouble. He violated that probation with a theft charge in 1994, and was given a new sentence that involved intensive supervision.

In 2003, Hilgers went to prison for a technical violation of his probation, as well as a new conviction for issuing bad checks. He served time at the Butte pre-release center before coming to Helena, but wound up back behind bars in August 2006 for allegedly failing to pay victim restitution and use or possession of drugs or alcohol.

After he was released, Hilgers was returned to prison after being convicted of driving under the influence of drugs or alcohol in November 2006 in Lewis and Clark County.

A trial for Hilgers and Rice is set for Aug. 13 in U.S. District Court in Helena.