Justice Diane Hathaway expected to plead guilty Tuesday in federal court

ANN ARBOR (WXYZ) - Justice Diane Hathaway is used to accepting plea deals. On Tuesday, she'll be giving one of her own. The 20-year judge, who served on Michigan's highest court, is expected to plead guilty to bank fraud before Judge Corbett O'Meara, marking the end of a 9-month saga that cost her her gavel, and reputation.

"Justice Hathaway threw away her career for $600,000….why would anyone rationally make that decision?" said Wayne State Law Professor Peter Henning.

The plea follows a month-long probe by the FBI, sparked by a 7 Action News investigation into Hathaway's suspicious property shuffle.  She moved homes out of her name and into her stepchildren's around the same time she was asking her bank for a short sale, saving her from $600,000 in mortgage debt.

"If you look at the cost she's going to pay, it's far more than $600,000," Henning said.

Hathaway is already at risk of losing her law license, but it may not end there. She's also a licensed real estate broker and today 7 Action News spoke with the bureau that  regulates broker licenses. A spokesperson says it is too early to comment, but if Hathaway were convicted of a felony, the bureau would launch an investigation into her broker's license.  She would be evaluated for good moral character.

If Hathaway pleads guilty tomorrow as expected, she likely won't be sentenced for several months. If you think a fellow judge will go easy on her, former federal prosecutor Peter Henning says not so fast. 

"The judge may well look at it and say, I'm not going to deviate, I don't want to send the message that judges can play fast and loose with the rules," Henning said.

"Especially rules of which they are quite well aware."

If you have a tip for the 7 Action News Investigators, contact us at tips@wxyz.com or at (248) 827-9466.

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