WILMINGTON, Delaware (Bloomberg) — A former Royal Bank of Canada banker will plead guilty to fraud and tax charges and cooperate in an FBI probe of a mortgage scam involving some of Southern California's most exclusive neighbourhoods.Richard A. Maize, 53, of Beverly Hills, agreed to plead guilty to bank and loan fraud charges as well as one count of making a false statement on a tax return, the US Attorney's office in Los Angeles said in a statement on Friday.

Maize and five other people charged in the case took out inflated mortgages on homes in Beverley Hills, Bel Air and Malibu, according to federal prosecutors.

"This was definitely a high-end fraud," Assistant US attorney Jeremy D Matz said in an interview. "It's for that reason that the losses ended up being so much on each loan."

Maize was pulled into the scheme by a friend he trusted, his attorney, Carolyn Kubota, said in an interview on Friday.

"Rich is looking forward to resolving this matter, putting it behind him and moving on with the rest of his life," Kubota said.

The scheme involved about 80 loans, each of which were worth between $1.4 and $2.8 million, Matz said. Lehman Brothers Bank, a unit of Lehman Brothers Holdings Inc., and RBC Mortgage Co., a unit of Royal Bank, lost $40.6 million, Matz said.

Lehman Brother spokeswoman Kerrie Cohen wouldn't comment. A spokesman for Royal Bank didn't immediately return a phone call.

To keep the scam going, the participants had to take out new loans to make payments on the old loans. The loans were all based on inflated estimates of the value of several high-priced homes, Matz said.

Four other people charged in connection with the case have pleaded guilty, Matz said. A fifth, Charles Elliott Fitzgerald, 47, of Newport Beach, California, is scheduled for trial in July. An attorney for Fitzgerald didn't immediately return a call for comment.

Maize co-founded the mortgage company Americorp Funding in West Los Angeles. He and his partners sold the company in December 2000 to a subsidiary of Royal Bank, according to prosecutors' statement.